As mentioned yesterday, this blogpost is the second half of a discussion on the impact of the medical device excise tax anticipated to be rolled out in 2013. This post examines some of the opinions on why the medical device tax will not be as devastating as some advocacy groups have led us to believe.
While medical device companies certainly don't like having to hand over more money to the government than they did before, there are definitely some people who don't buy in to the theory that the tax will reduce the US medical device industry to a fiery rubble.
For example, at the Bay Area Biomedical Device Conference, an executive panel featuring medical device company CEOs casually brushed off the impact of the tax, saying that the medical device industry features high enough margins for the tax not to be a concern.
Additionally, this article provided an interesting perspective on the Affordable Care Act from one former Stryker employee: although he lost his job as a result of the tax and has taken a pay cut in his subsequent job, he appreciates the fact that his older daughter gets to stay on his health insurance longer. I found this perspective particularly interesting because it's not one often seen among the arguments for or against the tax, which tend to be focused on company impacts rather than the effects at an individual level.
And maybe medtech jobs won't actually be as slashed as we think; although AdvaMed claims that the tax could cost more than 45,000 jobs, this survey by Emergo Group indicated that, while obviously not thrilled about the tax, less than a fifth of companies planned to invest less in R&D, and even less than that would reduce headcount in response. In fact, 52% of North American respondents indicated that they would actually increase their head count in 2012.
So maybe US companies don't need to give up and ship off to Europe just yet.
What are your thoughts? Let us know in the comments.