Congressman Mike Turner (OH-10) reintroduced the First Responder Medical Device Tax Relief Act – legislation to repeal the tax on medical device manufacturers. On January 1, 2013, Obamacare began imposing a 2.3 percent excise tax on the sale of medical devices by manufactures, providers, and importers. This tax will place yet another burden on American businesses, stifling development of innovative life-saving products and costing jobs when our economy is struggling to recover, and will result in higher costs and inferior care for patients. 

“Southwest Ohio has long been known as an incubator for advanced manufacturing. The gains and jobs medical device manufacturers have made in our state will not continue with the implementation of this tax. This tax is prohibitive to the type of growth Ohio and the nation needs in these difficult economic times,” said Congressman Turner. 

Turner has visited Mound Laser & Photonics Center (MLPC), a company headquartered in Miamisburg, which specializes in laser-based micro and nano-fabrication and provides services to a number of markets, including the medical device industry. He has also met with business leaders from Ferno-Washington Inc., a global leader in manufacturing and distribution of professional emergency and healthcare products based in Wilmington, Ohio. Both MLPC and Ferno say the tax increase may cause them to pass the tax increase on to customers through the sales price.

“The medical device tax will most definitely stifle research, development and growth in a field that represents one of America’s last great manufacturing bases. As a small business owner that works directly with a number of medical device manufacturers, I have already witnessed the unfortunate results from this tax; since the introduction of this tax, I have had to reconsider my investment options, reassess forecasted growth projections and was forced to temporarily lay off a portion of my workforce,” said Dr. Larry Dosser, President of MLPC. 

Proponents of the excise tax, set to go in effect in 2013, argue that medical device revenue will go up as insurance coverage expands, but that reasoning does not apply to emergency services. Increases in the number of people insured will not substantially increase the number of emergency medical service transports. In addition, the 2.3 percent tax may well be passed on by manufacturers to consumers – including state and local governments.

“As a former Mayor, I know the difficult budget decisions localities will have to make in the face of increased costs for emergency medical equipment. State and local governments may not be able to afford the equipment they need, or will have to shift scarce dollars away from other badly needed services. Leaving this tax in place will increase the cost of emergency care and inhibit development of innovative emergency medical equipment,” added Turner.


NOTE: A letter from BioOhio supporting this legislation can be found HERE.