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Area Development - Site Selection, Facility Planning and Workforce Development

Manufacturing Groups: Healthcare Bill Not A Good Remedy For Business

03/23/2010
The National Association of Manufacturers and the Medical Device Manufacturers Association say the new healthcare reform legislation signed into law today will negatively hinder business competition, slow the recession recovery and negatively impact employee healthcare options.

NAM President John Engler stated the passage of the Patient Protection and Affordable Care Act (H.R. 3590) and the Reconciliation Act of 2010 (H.R. 4872) will increase costs and make it difficult for manufacturers to continue to offer generous health benefits.

Ninety-seven percent of NAM member companies voluntarily provide health care benefits, according to the group.

"The legislation passed today will stifle manufacturers' ability to grow and create jobs while competing in a challenging global economy," said NAM in a press release.

Manufacturers oppose many provisions in the bill including the excise taxes on health insurance plans which NAM said will adversely impact many companies with older workforces and smaller self-insured plans, the increase in and expansion of the Medicare hospital insurance tax, which would increase taxes on investment income and unfairly target some 70 percent of U.S. manufacturers that file taxes at the individual rate.

The group said the limits on Flexible Spending Accounts (FSAs) would curb design flexibility options for manufacturers and place an immediate tax increase on employees that use these tools and also opposes the new industry-specific fees that single out particular industries to pay for health care reform.

"This legislation is fundamentally flawed.and could cost as much as $2 trillion over 10 years once it takes full effect," said NAM. The group said manufacturing has lost 2.2 million jobs since December 2007.

"America's manufacturers will continue to advocate for real health care reform that lowers costs, improves care and does not impede our ability to create jobs, grow our economy and remain competitive in a global market," stated the group.

The Medical Device Manufacturers Association has also issued concerns about the healthcare bill, citing how the $20 billion device tax provision will impact patient care, innovation and small businesses.

"If eliminating the tax is not possible, structuring it to provide relief for smaller companies is critical. Under the current structure, many companies will owe more in taxes than they generate in profits, requiring companies to lay off employees, cut R&D budgets and slow the development of new therapies that will improve the quality of care for all Americans. Moving forward, these issues must be addressed before the tax takes effect in 2013," the group said in a press release.

But one manufacturing group is endorsing the healthcare reform bill.

The Pharmaceutical Research and Manufacturers of America (PhRMA) called the bill an "important and historic step" toward expanding high-quality, affordable health care coverage.

"We strongly believe that everyone in America should benefit from promising new advances in medical care," said the group in a press statement.

The group represents pharmaceutical research and biotechnology companies.

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