Want a word to sum up 2017? Try “uncertainty.”
Chris Newmarker, Managing Editor
[Image courtesy of White House]
For the most part, the medical device industry’s top executives have sounded positive about the situation during earnings calls with analysts. And when Medical Design & Outsourcing and MassDevice readers responded to an online survey about Trump and the Republicans, 42% said they would be good for medtech, versus 33% who thought they would be bad.
Medtech insiders are especially optimistic that the much-hated medical device excise tax will soon be dead for good. They see happy days ahead. “Fully repealing the medical device tax, establishing a more transparent and predictable regulatory process, lowering corporate taxes and properly reimbursing medical technologies would create an environment that allows this proud American industry to thrive,” Mark Leahey, president and CEO of the Medical Device Manufacturers Association, said in a statement after Trump’s address to Congress.
Here is one word, though, that sums up why the device industry should have some pause about the situation: “uncertainty.”
Over my 16 years as a journalist – 10 as a business journalist – I’ve learned that “uncertainty” is a toxic word. It’s the word executives and business owners use when they’re explaining why they aren’t hiring or building a new plant or investing in R&D or taking other risks.
There is a lot of uncertainty in the present political environment. Don’t take my word for it, either. Respected hedge fund manager Seth Klarman – ”The Oracle of Boston” – recently made waves with a private letter to investors, relayed by media outlets including CNBC and The New York Times. Klarman warned that Trump’s unpredictable style and protectionist trade talk create even more risk and uncertainty.
As the ancient Romans liked to say: “Fortune favors the brave.” But it is also smart to identify the unknowns out there, the hazards of the environment in which we are operating.
Here are 5 major uncertainties to keep an eye out for as the year progresses.
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Nicely done, Chris.
Thanks, Joe! Appreciate it.
Chris,
As a veteran of the Insurance, Financial Services and Healthcare DME space for more years than either of you are in age…I(compliment to you both) have seen it all..
The unfortunate situation with Obamacare, was the political ideaology that was used as the premise to put Obamacare in place….anyone with any smarts or experience, knows, that it was a failure from the beginning. Keep in mind, Obamacare created a larger entitlement society…which are comprised of those uninsured, many of which never wanted insurance….(remember when you were 21 – 30 years old, invincible, never go to a doctor other than for a cold or something, once a year….yet paid premiums either through your employer, for as low as $2,000 per year (40 years ago for, that’s at age 30) and could not justify paying those premiums, UNTIL YOU WERE MARRIED AND HAD A CHILD!!!!)
For those reasons, TRUMP and his team, were kind and are providing up to $14,000 per year for those who need it, all based upon the need via HSA…..offering tax free accumulation and use for premiums, prescriptions, co-pays and anything medically related including dental needs. Otherwise, we SHOULD repeal entirely….
No one has to take Maternity, or Birth Control pills or any other benefit as OBAMACARE loaded up everyone on the same standard policy, whether you needed it or not. Now a 28 year old, can have “skinny policy” and pay for what you need, only. WE NOW have a CHOICE on the Individual Market. Secondly, the Individual policies premiums are covered under Section 125 of the IRS code, unlike Obamacare, meaning the premiums are exempt from Federal and State Income taxes.
Your word”uncertainty” was written on March 3rd, before you have a chance to see the proposed bill, which will certainly have a few changes…Your word “uncertainty” goes away, once the bill is passed and it will pass!
Lastly, please do not use NY TIMES as your source to interpret anything….It will be slanted to the liberal left, which got this country into the problems we have to correct today…go directly to the Fed.gov site and read it for yourself…. PEOPLE only want the real language….. I read the NYTimes interpretation myself and true their word, they slanted it to show that Obamacare was not so bad after all….Yet, if you lived on the Insurance side of the World, you see the real impact. At least, 11,000,000 to 20,000,000 do not want to pay for insurance, but they’ll take it if you give it to them….but for those who do pay, and do not qualify to get a reimbursement benefit, many do not want to even have the insurance, because their return on investment, is absolutely ridiculous….
NOW for comments regarding many of my DME clients….it was ridiculous to assess tax on all medical devices….it caused many to change their short term and with many a long-term strategy to re-design their organizations, to reduce costs throughout their organizations. In some cases, seeking opportunities for acquisition strategies, allowing for better corporate tax benefits, especially during the time, given to delay the implementation of the tax to January 2018….THAT WILL BE REPEALED as well, mark my word….as you well know, that tax, would have had to been offset in additional costs to provider, patients and etc. and ultimately a further burden on the Payor and Patient, not a WIN-WIN situation.
We are going in the right direction….as opposed to have 21 states, that Payors left only one choice for enrollment for those that needed Obamamcare…why? a large majority of the payors are our clients as well…they were losing millions of dollars impacting their bottom line with Obamamcare, with the one size fits all requirement. Smart people know that will never work!
The real word, should now be”Optimistic,” about the future and allow the free market mandate the competitive rates for all companies to compete, without looking over their shoulder, worried about how they have reserved for a 700 million fine or the like….as an example….
Thanks for sharing your views, Merlin. I agree that there seems to at least be a bit more certainty now that a plan has been released, though passage of the plan is no done deal at all. Here’s the big headscratcher as I see it when it comes to any kind of healthcare/health insurance reform: Someone showing up at a hospital without insurance is my problem. (I’m assuming you have insurance, too, Merlin, so it’s also your problem.) Why? If the person without insurance isn’t able to pay—or worse, goes bankrupt—the cost gets shifted over to insurance-covered people like us. A pure free market solution to the problem would be, “Well, if you don’t have insurance or money, you don’t get healthcare.” But letting someone die on a gurney outside an emergency room door is wrong. So we’re stuck. The government has to step in and do something to make this crazy system work, and it either does it well or poorly.