Sales and Operational tactics to offset Health Care Reform- “Taxing” for Medical Device Companies

The Health Care Reform legislation passed earlier this year encompasses sweeping changes. It requires Medical Device companies to pay attention to a new “tax” slated to begin in 2013 that will impose a tax deductible 2.3% “medical device fee” for US sales on devices. Although 2013 seems a long way off, companies should start looking at Sales and operational tactics now to offset the impact of the new fees and protect their bottom lines. Of course one strategy would be to grow top line sales through price or volume increases domestically and internationally; however that strategy alone is far from being a “silver bullet.” Medical Device companies should begin to evaluate proven cost reduction strategies such as RFID-enabling their sales and distribution operations as a way to improve profitability as a hedge against the new fees.

Raftar has announced a “Risk-Free RFID” Pilot to offer, an opportunity for medical device companies to begin using technoliges to streamline operations and manage inventory and sales as way to prepare their organizations for the new realities of healthcare reform. The Pilot will allow Medical Device companies to build their business case for warehouse and field services autoamtion using RFID and quantify the ROI impact – that can offset the pending “tax” on their top line revenues. The RFID business case from one major Medical Device Manufacturer (MDM) puts it succinctly: “The savings (a 214% ROI) are generated from the elimination of the need to scan every implant item number and bar code.”