When it comes to the $20 billion medical-device
industry tax contained in the healthcare reform
legislation, we could, however incongruous it
would be, quote a 1970s cigarette ad campaign:
We’ve come a long way baby! Or, perhaps it would be better to
paraphrase the Rolling Stones with these encouraging words:
You can’t always [stop] what you [don’t] want. But if you
try sometimes, you might find you get what you need.

It’s true that the tax is a long way from the original $40
billion proposal that would’ve started this year. Instead,
thanks to the efforts of AdvaMed, its member companies,
and House and Senate members from California, Indiana,
Massachusetts, Minnesota, and New York, we ended up
with an across-the-board 2.3% point-of-sales excise tax that
won’t take effect until 2013; is deductible from corporate
income; and excludes hearing aids, contact lenses, and other
products, regardless of FDA Class, used by individuals and
purchased in retail settings.

Still, if device makers had their way, there wouldn’t be a
tax at all. As one industry source put it, “We fought to eliminate
this highly regrettable tax, which could slow research
and development, drive up costs, and result in lost jobs.”

However, reform did pass, and if our industry tries, we
might find we get what we need – a revamped reimbursement
system that rewards physicians for quality and efficiency,
rather than for tests and procedures.

“With healthcare reform passed, and regulation writing
about to begin, now is the time to work toward putting into
place policies that reward quality,” says Wanda Moebius,
AdvaMed’s vice president of policy communications. “From
our perspective, this is an exciting time. The goal is to avoid
policies that inadvertently choke off new technologies before
they can be widely diffused and adopted.”

For example, giving an aspirin to a stroke patient
within a given amount of time is currently a quality standard
for care. But what happens if a groundbreaking
technology usurps aspirin in effectiveness while the
aspirin standard remains? If that happens, the new technology
isn’t likely to be used by physicians for fear of
penalties by private insurers and CMS (Centers for Medicare
and Medicaid Services). But if policy is done correctly,
we might find we get what we need. Oh yeah!

So stay tuned and stay engaged. Cheers!

For a good book on the pluses and minuses of
healthcare systems throughout the world and how
they address this topic of reimbursement, read “The
Healing of America,” by T. R. Reid.

As always, I look forward to your comments and
insights. -- JJ