Obamacare in action- company scraps expansion plans over taxes

[dbair1967]

Indiana company scraps plans for expansion over ObamaCare device tax


By Judson Berger

Published July 27, 2012

FoxNews.com
A patient is put through a cat scan machine in Kingston, N.Y. (AP)

An Indiana-based medical equipment manufacturer says it's scrapping plans to open five new plants in the coming years because of a looming tax tied to President Obama's health care overhaul law.

Cook Medical claims the tax on medical devices, set to take effect next year, will cost the company roughly $20 million a year, cutting into money that would otherwise go toward expanding into new facilities over the next five years.

"This is the equivalent of about a plant a year that we're not going to be able to build," a company spokesman told FoxNews.com.

He said the original plan was to build factories in "hard-pressed" Midwestern communities, each employing up to 300 people. But those factories cost roughly the same amount as the projected cost of the new tax.

"In reality, we're not looking at the U.S. to build factories anymore as long as this tax is in place. We can't, to be competitive," he said.

Company executive Pete Yonkman first revealed the scuttled plans in an interview with the Indianapolis Business Journal. The company later confirmed the decision to FoxNews.com.

The Affordable Care Act imposed a 2.3 percent tax on medical devices beginning in 2013. It is projected raise nearly $30 billion over the next decade.

But the Cook Medical spokesman said the impact is greater than just a 2.3 percent uptick in taxes. He said the impact on actual earnings is another 15 percent, and he projected the company's total tax burden next year will rise to over 50 percent.

Republicans and medical device makers have been railing against the tax all along, with the GOP-controlled House approving a bill last month to repeal it. The Senate, though, hasn't taken it up.

A recent study by the left-leaning Center on Budget and Policy Priorities, though, said the complaints by the industry are exaggerated.

"The tax will not cause manufacturers to shift production overseas. The tax applies equally to imported and domestically produced devices, and devices produced in the United States for export are tax-exempt," the study said. It also said repealing the tax would "undercut health reform" by requiring Congress to offset the repeal by potentially killing spending provisions in the law and by potentially encouraging similar repeals.

Cook Medical is part of a family of companies that produce medical devices for surgery, obstetrics, gynecology and other fields.


Read more: http://www.foxnews.com/politics/201...sion-over-obamacare-device-tax/#ixzz21uVeXPDv

 

[FuzzyLumpkins]

I know at least two business owners that are going to take the tax credit for small business towards their health insurance and in one case hire some people for telemarketing and for the other open a new store.

Anecdotes are just that.

Quite frankly I have very little sympathy for medical device manufacturers, and this is coming from someone that engineers medical imaging devices. I know exactly what the margins are.

 

[dbair1967]

Quite frankly I have very little sympathy for medical device manufacturers, and this is coming from someone that engineers medical imaging devices. I know exactly what the margins are.

uh huh

 

[superpunk]

The health care bill is primarily about driving down costs for citizens, not making it easier for businesses who are raking in ridiculous profits to continue raking in those profits.

 

[dbair1967]

The health care bill is primarily about driving down costs for citizens, not making it easier for businesses who are raking in ridiculous profits to continue raking in those profits.

costs have went up since the bill passed, nothing became less expensive

in fact they inserted more mandates into coverages, making them even more costly

 

[superpunk]

costs have went up since the bill passed, nothing became less expensive

in fact they inserted more mandates into coverages, making them even more costly

Nothing happens overnight sweetheart.

 

[Sheik]

Nothing happens overnight sweetheart.

Or in 4 years.

 

[lons]

Or in 4 years.

Apparently though, it will magically all get done if we give Obama 4 more years! Dear fucking God, what will be the Democrats running platform should Obama get 4 more and it's the same or worse?

 

[dbair1967]

Apparently though, it will magically all get done if we give Obama 4 more years! Dear fucking God, what will be the Democrats running platform should Obama get 4 more and it's the same or worse?

Lets just make sure he doesnt get 4 more years

 

[superpunk]

Or in 4 years.

Oh Sheik you're such a kidder. 30 million people now have access to healthcare because of this bill.

 

[dbair1967]

Oh Sheik you're such a kidder. 30 million people now have access to healthcare because of this bill.

lol

and 2/3 or 3/4 of them are probably illegal aliens

 

[Bob Sacamano]

In English please.

 

[FuzzyLumpkins]

uh huh

What are you trying to insinuate?

 

[FuzzyLumpkins]

costs have went up since the bill passed, nothing became less expensive

in fact they inserted more mandates into coverages, making them even more costly

The bill hasn't even been implemented. You recall all the GOP states lawsuit?

Further the mandate, exchanges, and medicaid expansions have not happened.

Further have you looked at it in terms of rate of change? Is cost increasing at a faster pace, the same pace or at a lesser pace? The rate of change has been disturbingly high. Saying that its still rising does not posit much.

 

[FuzzyLumpkins]

Apparently though, it will magically all get done if we give Obama 4 more years! Dear fucking God, what will be the Democrats running platform should Obama get 4 more and it's the same or worse?

The GOP puts the tag of Obamacare so stupid people can have something to look to. OTOH, if you think that the bill is completely tied to Obama and that it doesn't have other legs is naive at best.

Oh and as for the OP, rather than the anecdote lets look at what the Texas Hospital Association says:

Texas Hospital Association President and CEO Dan Stultz said hospitals agree with Perry that the Medicaid program is “severely flawed,” but he added that “without the Medicaid expansion, many will remain uninsured, seeking care in emergency rooms, shifting costs to the privately insured and increasing uncompensated care to healthcare providers.”

Stultz said that with “a strained budget, it’s hard to imagine addressing the uninsured problem in Texas without leveraging federal funds.”

http://www.themonitor.com/articles/austin-62143-failure-medicaid.html

Tweet


Topics:

Aging
Delivery of Care
Health Costs
Health Disparities
Supreme Court
Hospitals
Women's Health
Health IT
Insurance
Marketplace
Medicare
Medicaid
Mental Health
Politics
Public Health
Quality
Health Reform
States
Uninsured

Businesses Will Push Perry to Rethink Medicaid Expansion

Print
Share
Email

By Jay Hancock

KHN Staff Writer

Jul 18, 2012

Texas Gov. Rick Perry says he rejects the "Obamacare power grab" and will block measures expanding health insurance to millions in his state. The country’s second-biggest health insurer is betting he won’t succeed.

The same day last week that Perry said expanding Medicaid would be like "adding a thousand people to the Titanic," WellPoint Inc. disclosed an agreement to buy Texas’s biggest Medicaid managed care company for $4.9 billion. The purchase of Amerigroup, which operates in 12 other states besides Texas, is WellPoint’s attempt to cash in on the health act’s addition of 17 million Americans to Medicaid, the state and federal program for the poor.

The Supreme Court decision allowing states to block Medicaid growth without a penalty, however, threatens the profits of companies hoping to manage care for the new beneficiaries. Perry is one of more than half a dozen Republican governors resisting the federal Medicaid windfall set to begin in 2014.

But if there’s one thing more powerful than Republican governors' dislike of the Affordable Care Act, many believe, it may turn out to be the business interests in their own states.

"Once the headlines die down, every hospital in Texas is going to look at Perry and say, 'Please tell me why we're not taking money from the federal government to offset my uncompensated care,'" said Thomas Carroll, who follows health insurance stocks for investment firm Stifel Nicolaus. "That is a question that Rick Perry absolutely cannot answer."

A higher portion of Texans lack coverage than residents of any other state. A Texas Medicaid expansion would generate $100 billion in federal money for the state over a decade, according to the state Health and Human Services Commission, and furnish coverage to an estimated 2 million Texans.

At the same time it would generate nearly $1 billion in annual Texas revenue for Amerigroup and WellPoint, calculates Carroll.

Quiet for now, insurers are expected to join hospitals and patient advocates to fight for Medicaid expansion and what are enormous amounts of money, even by Washington standards. Nowhere are the dollars bigger than in Perry's state, where one in four lacks health coverage.

"Fights seem to follow the money, and there is a lot of money at stake in Texas on this," said Phil King, a Republican state representative from outside Fort Worth who opposes the Medicaid expansion. "Maybe you need to rename this 'The Full-Employment Act for Lobbyists.'"

With world-renowned medical institutions such as the University of Texas and a large part of its Medicaid coverage handled by private insurers such as Amerigroup, the state's health industry is "just behind oil and gas" in size and influence, said Vivian Ho, a health economist at Rice University. "Given how much Amerigroup has to gain from a Medicaid expansion in Texas, they may be one of the most effective organizations to lobby Perry and the state legislature to fund the expansion."

Founded in the mid-1990s in Virginia Beach, Va., Amerigroup contracts with 13 states to manage Medicaid care, generally for a fixed fee per member. Now grown to Fortune 500 size, the company had twice as many Texas members last year -- 632,000 -- as in any other state.

Amerigroup and merger partner WellPoint both have strong ties to Texas politicians.

Amerigroup’s Texas political action committee donated $20,000 to Perry's 2010 gubernatorial campaign, has given thousands more to numerous legislators and had $89,000 in the bank as of June 25, public records show. Two years ago Amerigroup’s foundation presented its "Champion for Children" award to Texas Sen. Judith Zaffirini, a Democrat from Laredo who sits in the senate’s Medicaid subcommittee.

Our lobbying overlords are going to push it through regardless.

 

[dbair1967]

The bill hasn't even been implemented. You recall all the GOP states lawsuit?

Further the mandate, exchanges, and medicaid expansions have not happened.

Further have you looked at it in terms of rate of change? Is cost increasing at a faster pace, the same pace or at a lesser pace? The rate of change has been disturbingly high. Saying that its still rising does not posit much.

You are uninformed my friend, numerous pieces of the bill HAVE in fact been implmented. Now most of the main garbage hits in 2014, but there's alot thats already happened

Costs in fact have went up due to some of the provisions in the ridiculous bill. They'll skyrocket once the full thing takes effect.

 

[FuzzyLumpkins]

You are uninformed my friend, numerous pieces of the bill HAVE in fact been implmented. Now most of the main garbage hits in 2014, but there's alot thats already happened

Costs in fact have went up due to some of the provisions in the ridiculous bill. They'll skyrocket once the full thing takes effect.

i never said none of the bill was implemented the exchanges, medicaid expansions and mandate have not been implemented.

You ignore the discussion rate of change and just assert causality without basis.

Do you repeat this stuff in your head over and again or do you just save it for the board. You should do it more perhaps it will become true.

 

[dbair1967]

i never said none of the bill was implemented the exchanges, medicaid expansions and mandate have not been implemented.
.

You said the bill hadnt been implemented, which isnt true. Many provisions of the bill have in fact been implemented. And they've impacted the costs on healthcare plans.

How do I KNOW this? Because I work for a healthcare company. I work with underwriters and actuaries on a daily basis. We get almost daily updates on all the Obamacare nonsense.

 

[FuzzyLumpkins]

You said the bill hadnt been implemented, which isnt true. Many provisions of the bill have in fact been implemented. And they've impacted the costs on healthcare plans.

How do I KNOW this? Because I work for a healthcare company. I work with underwriters and actuaries on a daily basis. We get almost daily updates on all the Obamacare nonsense.

Fair enough. I should have said not fully implemented.

Now do you care to address the rate of change? For example, are you claiming that had the bill not been passed that costs would not have risen?

If you accept that health care costs have been rising the question then becomes has the cost of health care increased more than if it had not been passed.

You familiar with the concept of differentials? Is the differential now higher than it was in 2007? From cursory inspection, this graph says no. Then there is the CBA but I am sure you will claim that the CBA is wrong.

Quite frankly who gives a shit what the health insurance industry thinks? I used to work in insurance too even if it was P&C and quite frankly they are not exactly objective. It's like asking Exxon about climate change.

 

[dbair1967]

Fair enough. I should have said not fully implemented.

Now do you care to address the rate of change? For example, are you claiming that had the bill not been passed that costs would not have risen?

If you accept that health care costs have been rising the question then becomes has the cost of health care increased more than if it had not been passed.

You familiar with the concept of differentials? Is the differential now higher than it was in 2007? From cursory inspection, this graph says no. Then there is the CBA but I am sure you will claim that the CBA is wrong.

Quite frankly who gives a shit what the health insurance industry thinks? I used to work in insurance too even if it was P&C and quite frankly they are not exactly objective. It's like asking Exxon about climate change.

"health care spending per capita"

You can post stuff like this, but the spend per capita is less because the amount of care delivered is less. Government WILL curtail care and control access, unlike what we have here. People thought HMO's were bad in the early to mid 90's, well they would be considered a free for all when compared to the typical government run healthcare plans.