AdvaMed Boss Worried Over Sequestration

Investors of medical device companies may be greeting the automatic budget cuts of sequestration with a big yawn and the White House is accused of fear mongering by Republicans, but Steve Ubl, the head of AdvaMed, the Advanced Medical Technology Association, is worried.

In a March 2, 1013 interview with Minnesota’s Star Tribune, Ubl said he worries that the sequestration’s “political distraction” will draw focus from his top priority, which is repealing the newly imposed medical device tax.

Ubl also said the automatic budget cuts required by sequestration will affect the FDA budget, as well as the fees industry pays.

“Both will be reduced 5.1 to 5.3%. A related issue is the continuing [budget] resolution that allows the government to collect [user] fees at a higher level associated with a new user fee agreement, but only spend at the level of the old user fee agreement. That [difference] is about $40 million. The other sequester impact is a 2% reduction in the Medicare program, which is across the board, ” said Ubl.

Ubl said he’s frustrated and is working with a coalition called the Alliance for a Stronger FDA. “AdvaMed is partnering with other groups in the life sciences to call attention to the negative effects associated with the sequester.”

AdvaMed members would be better off without the automatic budget cuts said Ubl. “If Congress were to revert to regular order, there’d be a budget resolution and the appropriators would fashion individual appropriations bills. That would be a better process. History reflects that FDA does very well when those policymakers are making value judgments about the relative importance of agencies.”

We recently reported that according to a joint study released by the American Medical Association, the American Hospital Association and the American Nurses Association, in just the first year of the sequester, it is estimated that health care and its related industries will lose more than 496, 000 jobs. These numbers include those employed in the health care sector, as well as those affected by the purchases made by health care organizations and their employees. The analysis estimates the number of lost jobs will reach 766, 000 by 2021.