Independent analysis by a Web site dedicated to the medical device industry calls into question the accuracy of studies on how pending taxes from healthcare legislation will affect companies like Zimmer, DePuy and Biomet.
In the Sept. 21 edition of the Times-Union, it was reported that Advamed, a trade association for medical device makers, commissioned a study to look at the effects of a 2.3 percent excise tax passed as part of the Affordable Care Act of 2010.
The tax would go against companies’ gross revenue rather than profit.
In the Advamed study, it estimated that about 43,000-plus jobs would be lost in the medical device industry.
After Advamed’s study came out, Bloomberg Governement released a report refuting the claims made that it would cost the industry anywhere between $670 million and $7 billion.
Last week, MassDevice.com released its own investigation into the effects the excise tax will have on medical device companies by looking at the 50 largest companies in the field.
MassDevice.com states that one colllateral effect of the tax may be disproportionate effects on companies depending on their profit margins.
The report also states that as currently constructed, the tax will take in more than the $2 billiion in revenue it is scheduled to.
The tax is scheduled to take effect Jan. 1.
That however may be thrown into question depending on what the Supreme Court does.
The highest court in the United States recently heard arguments regarding what is commonly refered to as Obamacare and experts expect that the court will release its decision about whether the law should be repealed this summer.
MassDevice.com’s report cites local company Symmetry Medical as one company that could be adversely affected by the tax.
Through compiling revenue data from previous years, MassDevice.com determined that if the tax were to take effect in 2013, Symmetry Medical would go from a profit of $3 million to a loss of $3 million.
MassDevice.com stated in its report that for more than 75 percent of the other companies on its list, the tax means lower profits by between 5 percent and nearly 50 percent.
The Bloomberg report advanced the notion that any losses that medical device companies will take on may entirely be recouped by the fact that a much larger pool of Americans will be insured.
Advamed responded to that claim by saying it stood by its story and dismissed a claim of recouped costs by the medical deivce companies.
