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Medical Device and Diagnostics Tax May Hinder Innovation
Submitted on:
10.02.2009
The San Diego Union-Tribune published an OpEd by CHI board member Carl W. Hull, president and chief executive officer, Gen-Probe Incorporated, regarding how the medical device and diagnostics "fee" proposed by the Senate Finance Committee may hinder innovation. The plan includes adding a $4 billion annual "fee" on sales of medical devices and diagnostics. According to analysts, this fee will add between 10 percent and 30 percent to a company's annual tax bill. Not only will this tax cause smaller companies to struggle with the little cash they have, it can potentially raise healthcare costs. A study by the Lewin Group showed that spending on diagnostics makes up less than 5 percent of hospital costs and 1.6 percent of Medicare costs, yet influences 60-70 percent of healthcare decisions. Effective use of diagnostic technologies promotes early detection of disease, improves patient outcomes and reduces expensive downstream complications. Hull believes this fee will only hurt the industry and limit patient access to innovative products.
Click here
to read the OpEd in The San Diego Union-Tribune.
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