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Medical Device Companies Fight Health Care Reform Tax

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Above: KPBS examines what the historic health care reform bill may mean for local San Diegans.

— Congress wants to help pay for health care reform with a tax on medical device companies. The idea is not popular with industry members in California.

California employs about a third of all American workers in the medical device industry. San Diego-based Gen-Probe has 800 employees, locally, and makes products that diagnose disease. CEO Carl Hull estimates the tax would cost Gen-Probe at least $5 million a year. He said that will likely force his company to reduce research and development. He said smaller companies will be hit even harder.

The impact of such an added tax will cause them to be either unprofitable or profitable much later than they expected," said Hull. "And ultimately will have the impact of reducing jobs."

Supporters of the tax say Congress needs to find ways to pay for health care reform without adding to the budget deficit. The House health care bill includes $20 billion over ten years from the medical device tax.

Audio

Aired 11/16/09

Congress wants to help pay for health care reform with a tax on medical device companies. The idea is not popular with industry members in California.

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