The Affordable Care Act (ACA) (colloquially known to many as Obamacare) was signed into law last year. However, many Americans are still trying to grasp what this reform means to them.
Expanded Health Insurance Coverage
The standout feature of the ACA is the ‘individual mandate’ to maintain health insurance. This will add an estimated 30 million people to the insured pool. Nevertheless, Siegel suggests that this newly ensured population is likely to be younger and in less need of the ageing-related devices such as pacemakers and orthopedic implants.
The Medical Device Tax
This has been a hot topic in our industry, but despite aggressive lobbying it appears that this tax is here to stay.
The suggestion that companies will move operations overseas seems to be discarded since the tax impacts all sales in the US regardless of where the company is located. However, Amy Siegel points out that the common med tech strategy of first gaining approval and selling in Europe will be reinforced by this tax.
Her advice: ‘ignore the tax for now and keep developing products that make a difference’.
Comparative Effectiveness Research
The Patient-Centered Outcomes Research Institute (PCORI) was one of the first tangible manifestations of the ACA. However, siegel mentions that PCORI will probably be focused on the most costly treatments affecting the most Americans, meaning a lot of novel niche products being developed will probably fly under the PCORI radar.
However, it seems that regardless of PCORI, the bar has been raised on clinical evidence required for regulatory approval, reimbursement and adoption of new medical devices.
In conclusion, Siegel tries the dampen fears on this impending reform stating ‘if your technology makes sense today in the care of patients, it will probably make sense in the brave new healthcare world’.
How do you think the ACA will impact small med tech companies? We’d love to hear your thoughts.
Photo Credit: Intel Photos