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Published November 28, 2012, 06:02 PM

Implantable medical devices may begin taxing in the New Year

Fargo, ND (WDAY TV) - Many of you likely had a new knee or hip put in, possibly a heart-valve replaced, or pace-maker installed. All of those "implantable" medical devices will now be taxed, starting January 1st.

By: Kevin Wallevand, WDAY Staff Reports, WDAY

Fargo, ND (WDAY TV) - Many of you likely had a new knee or hip put in, possibly a heart-valve replaced, or pace-maker installed.

All of those "implantable" medical devices will now be taxed, starting January 1st.

It's Part of the government's new "affordable care act." Some health care industry leaders are already fighting to repeal the tax.

Those who make heart valves, stents, knees and hips, often get criticized for the high cost of these implantable devices that either keep us alive or walking better. But now the industry is fighting Uncle Sam. The first of the year, a medical device tax will cost medical tech companies nearly $3 billion a year.

Doug Vang, Essentia Health-Fargo: “At this point, we don't know what the answer to that is.”

Fargo Essentia's Doug Vang says there are a lot of unanswered questions for hospitals and clinics. While manufacturers can pass the tax on to hospitals, hospitals may have to eat the cost.

Vang: “We have entered into value based contracts fixed contracts with insurance companies like Medicare and Medicaid so we are not able to pass those on because we have contracts.

And there's a lot of unknowns out there. An implantable device like a total knee or hip you can understand, but what about a catheter or sutures.

The health care industry nationwide is working to have Congress repeal the medical device tax.

Vang: “There are studies there are tens of thousands of jobs, are likely to be lost and companies are already laying off people. The last things a Democrat or Republican wants is to decrease manufacturing.”

The chances of repealing this: not much. Congress has already cut the device tax in half and the medical technology industry is not the only group asking for special treatment.

Another arm of the medical technology industry paying attention to the tax is the Medical Imaging and Scanning field. Fargo companies tell us they're unsure if they will be impacted.

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