With Special Tax Suspended, Medical Device Firms Reap Big Savings

(By Mark Zdechlik, Minnesota Public Radio, via Kaiser Health News)

U.S. manufacturers of medical devices started 2016 with a windfall — a two-year suspension of a controversial tax on their revenue.

Medical devices include a wide range of products and machines used in medical care, such as tongue depressors, endoscopes and MRI scanners, for example. Manufacturers said the tax on devices hurt their business. The Congressional Research Service estimatescompanies paid out $2.4 billion in 2014.

“When this tax went into place, it forced us to make cuts and sustain those cuts,” said George Montague, chief financial officer of Minnesota-based Smiths Medical. His firm takes in more than $1 billion a year for its specialty medical products. Read more…

 

Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

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