– The Washington Times – Tuesday, August 19, 2014
The Obamacare program got a double dose of bad news Tuesday as a federal watchdog reported its tax on medical devices is bringing in less money than expected, while a Federal Reserve study warned that many private companies expect to see their health costs soar because of the president’s signature health law.
The audit released Tuesday by the Treasury Inspector General for Tax Administration (TIGTA) said the widely criticized medical device tax is proving unwieldy and has brought in less money than the law’s architects had hoped, raising larger questions about the government’s ability to manage the other taxes included to help pay for the health care law.
The IRS hasn’t even been able to identify exactly which FDA-registered manufacturers should be paying the 2.3 percent excise tax on their sales of medical devices, TIGTA inspectors said in the new report.
A separate study made public Tuesday added to Obamacare’s woes as the New York Federal Reserve reported that half of state manufacturers and a third of service sector firms contemplating a change in their health insurance carrier expect the law to “considerably” increase their health care costs next year.
More than a third of manufacturing firms and four in 10 on the service side said they would not be changing their company health plans for the coming enrollment season.
“For those that were planning a change, however, the most widely reported adjustments involved higher deductibles, increased copays, higher out-of-pocket maximums and an increased employee contribution to the premium,” the Fed reported.
The medical device tax brought in $913 million in the first half of 2013, or about 75 percent of what the IRS had estimated, TIGTA auditors said.
Also, the inspector general said the IRS mistakenly assessed 219 penalties totaling more than $700,000 during a grace period between March 31 and June 30. While the tax agency reversed 133 of those penalties, the inspector general flagged the other 86 penalties so that the IRS could erase them and issue apologies to the affected taxpayers, the report said.
Read more: http://www.washingtontimes.com/news/2014/aug/19/treasury-ig-obamacare-medical-device-tax-trouble/#ixzz3AwnhFPUd
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