In an effort to help pay for health care reform, the Senate Finance Committee included a $40 billion tax on medical devices that manufacturers would have to pay to the federal government over 10 years.
- Any tax on wheelchairs, prosthetics and durable medical equipment will increase the cost to the end-user and make it harder for people with disabilities to get what they need.
- The tax would greatly decrease the medical equipment industry's ability to research and develop new devices.
- Senate Finance Committee wants a 40 billion dollar tax on medical devices to help pay for health care reform.
- Congress may lower the tax hit to 15 to 20 million dollars.
What does this mean for consumers of medical devices (including power wheelchairs and prosthetics)? Some fear that a new tax will be passed to consumers through increased prices and fees. We are working to lessen the impact that consumers will face.
We have advocated for a more reasonable tax, and it appears that Congress has heard our voices! The House is considering a range of $15 to $20 billion and it appears that Senate Majority Leader Harry Reid is considering the same. In an ideal world there would be no tax at all, but in order to pay for many of the good things in health care reform such as more access to health coverage and no discrimination on the basis of pre-existing conditions, all health industries have had to make some contribution towards health reform.
When the Senate Finance Committee proposed a $40 billion tax, there was great concern over the effect it would have on development of future medical devices (for example power wheelchairs). The initial proposed tax would have cost over 40 percent of what is spent on research and development for all medical devices.
In the end, we are not happy with a new tax, but we are successfully working with Congress to lower any impact to consumers.
Peggy (Margaret V.) Hathaway, Esq.
Vice-President for Public Policy
Spinal Cord Advocates
I think this is an outrageous funding scheme. With the large majority of wheelchair users being funded by Medicare/Medicaid/Insurers/VA, who is industry going to pass the tax along to? Not the players mentioned above since they seem to have more pricing control than industry has. And not to people who purchase wheelchairs out of pocket since there are not enough of them to make up that many dollars.
This is a bad situation for the wheelchair user since one of the less voiced options may ultimately be the only avenue left open to industry- cheaper to manufacture but lower quality wheelchairs and parts, and decreased after-sale service.