For John, BLUF: Actions have consequences. Nothing to see here; just move along.
Jeffrey Carter is an angel investor and independent trader. He talks about where Venture Capitalists are going these days:
One sector that is seeing a rapid investment drop is healthcare and devices. That has hurt the North Carolina VC industry harder than it hurt Boston. It’s also subject to some longer term trends. Obamacare has a medical device tax buried in it-and it has caused money to pull back from taking risk in healthcare while everything gets sorted out. The FDA is a horrible bureaucratic organization to deal with, and they have made it hard to innovate.Throw in Wisconsin, whose State Government has been trying to attract Venture Capitalists.
You create one little tax♠ and see what happens.
There is no free lunch.
Hat tip to the Instapundit.
Regards — Cliff
♠ A tax on medical devices, as part of the PP&ACA.
2 comments:
It's not the measly tax that has hit the growth of the sector - its the enhanced scrutiny that the ACA brings to bear for device makers to prove their case better before coverage. I could make almost anything and if I could get enough doctors to tell you that you need it I'm on a gold mine. Also, as I distribute my device I do so under private contracts with trade secrets and almost no price transparency.
Now the devices will be subject to comparative effectiveness research and their true efficacy will be known. Add to that the trend to 'bundle' costs which will create a market efficiency and the future doesn't look as rosy for the sector. The tax is a pittance.
http://www.nytimes.com/2013/10/17/opinion/the-myth-of-the-medical-device-tax.html?_r=0
It looks even worse for the consumer of those medical devices. I happen to have a rather severe OSA and my CPAP machine is quite literally a life saver. But now, thanks to ACA, just buying a new mask involves all sorts of certifications of need from doctors and respiratory therapists each of whom must answer the questions relating to the validity of the sleep studies I've had over the years..and under the CMS rules......now you must purchase your supplies from a CMS approved vendor......there are NONE in NH.
Oh....and the costs of all this brand new bureaucracy will be passed to guess who? The hope of the government is that they can make their case for lowered medical costs by eliminating the care altogether.
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