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Cosmetic Surgery Under ObamaCare

Regardless of your stance on ObamaCare, the one thing that is not in dispute is the sheer complexity of the legislation. How each field of medicine is effected is still very much unknown. The field of cosmetic surgery is no different. Cosmetic procedures are overwhelmingly elective meaning that insurance does not pay for them so the initial thought was the legislation would have little to no impact.

However, things are never that simple. When the legislation first passed in 2010, Democrats wanted to slap a 10% tax on cosmetic surgery. The language was very obtuse as to how many different items would fall under that category. Detractors snarkily referred to it as the “Botax.” The American Academy of Dermatologists, headed by Dr. David Pariser, opted not to take that lying down and spiked it quickly. Legislators turned their attention towards the tanning industry slapping a 10% tax on all indoor tanning. This legislation is still in effect today.

“We made the case this will reduce health care costs by hopefully reducing skin cancer in the future — that’s the point — and also raise a little revenue now,” Pariser told the New York Times in a December 2009 article.

Ryan Ellis, tax policy director for Americans for Tax Reform, the advocacy group founded by conservative economist and watchdog Grover Norquist, told the Sunshine State News, “The tanning salon industry is not nearly as well organized as the Botox and cosmetic surgery industry. It’s a perfect example of a well-organized industry throwing a non-well-organized industry under the bus; that’s exactly what happened.”

Alas, Dr. Pariser was unsuccessful in totally keeping the government out of his industry. In 2013, a 2.3% excise tax was enacted on all medical devices implemented. The medical device industry is vigorously opposed to this tax for obvious reason. The tax effects companies that have over $5,000,000 in receipts and, more punitively, the tax is levied on the top line and not the bottom. This means companies get taxed before they show a profit, a concerning development for an industry that sometimes won’t see a profit on new equipment in the infancy stages of product development.

Examples of this type of device would be prosthetic devices, pacemakers, and much of the material that would be involved in cosmetic surgery. These taxes will likely be passed on to the patient.

SUMMARY

In summation, for patients, the obvious impact of ObamaCare on cosmetic surgery is an increase in prices as material prices increase to the provider and is passed on. For those procedures that will be covered by ObamaCare, they will be paid out by the government. For practices dealing with Medicare, the satisfaction level is mixed at best. Dealing with state Medicaid organization, particularly in state like California, is a consensus nightmare.

It is hard to say if demand will change substantially either way as this is, as previously stated, typically an out of pocket expense.

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