The Medical Device Industry
Floor Speech
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Mr. PETERS. Mr. Speaker, I rise today with many of my colleagues to urge the full and immediate repeal of the medical device tax provision in the Affordable Care Act. As we speak, there are thousands of companies nationwide that are working to develop new technologies that will transform the face of medical care.
My district in San Diego, California, is home to numerous medical device manufacturers, innovating each day to improve the standard of care, reduce recuperation time for patients, and lower health care costs in the long term. There are small businesses and large companies generating an increasingly large economic impact in local communities like mine across the country.
I will use a few examples from my district, and I will feel bad because someone will tell me that I have missed some. NuVasive has developed minimally invasive spinal surgeries that allow a patient to walk more quickly post-surgery, spend less time in the hospital, and return to work sooner. That's better care, and that's money saved. CareFusion creates devices to improve patient care in hospitals, which minimizes mistakes and saves money. ResMed creates unique sleep apnea masks that improve patient health and productivity and reduces the incidence of other diseases associated with poor sleep. And Volcano created a new system which allowed physicians to get images inside arteries in a less invasive and more accurate way, giving a better picture of diseased arteries and how to treat them. All of these technologies will improve patient health and save health care costs, and they are vital job creators.
Nearly 250 medical device companies call my region home. Between San Diego, Orange, Riverside, and Imperial Counties, the medical device and diagnostics industry generated nearly $10 billion in economic activity last year. According to BIOCOM, our local life sciences trade organization, medical device companies in the San Diego area employ nearly 10,000 people and create more than $3 billion worth of economic activity in the county. That money has flowed into our local communities and further supports tens of thousands of other good jobs with good pay and good benefits.
In my party, we talk a lot about Make It in America, which is a great initiative. And there's no better way to make it in America than to support the development and manufacturing of medical devices.
So how are we supporting the development of this industry? Well, we aren't. We're punishing it. Instead of incentivizing or supporting this growing and productive industry, we are assessing a special tax just against this very industry, just against the medical device industry. And it's not a tax on profits, but a tax on revenues. So that makes it especially hard on early-stage innovators who are not yet making money. And can you imagine when you are getting started and every time you make a sale, you lose more money because of a tax directed at your revenues instead of your profits? And that's a result of the medical device tax.
This tax, added to the long lag we have in the FDA consideration and approval of medical devices, will drive jobs offshore. And that's not my guess. It's already happening.
Recently Cyberronics in Texas cited the medical device tax in its decision to expand not in Texas, not in America, but in Costa Rica. And San Diego businesses, I can tell you, today are actively making the same consideration: Can we make it here, or do we have to move offshore? Do we have to move these jobs offshore and this innovation offshore?
It's time to come to our senses, Mr. Speaker. The examples of technological innovation abound in San Diego and across the country, and we just can't punish our industries at the same time other countries are providing incentives--faster approval times--and not taxing this industry in particular, not singling it out with this kind of economic punishment.
So let's eliminate this tax. Let's support our innovators. And let's keep our American jobs. And I ask that we repeal this tax.
And I, again, thank the gentleman from Minnesota for setting this up and for helping to lead this bipartisan effort to keep our American jobs here and to keep innovation on our shores.
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