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Company: Mercedes Medical, Sarasota
Executive: Troy Barnett, CFO
Industry: Company is a medical-supply distribution firm.
Number of employees: 58
Health insurance challenge: The biggest disruption to the business, a company with $30 million in sales, is the 2.3% medical device tax, Barnett says.
The tax was one of the more controversial parts of the law. It went into effect Jan. 1, and federal officials say it could collect $20 billion to $30 billion to pay for other parts of the bill. The medical device industry unsuccessfully lobbied hard for repeal of the tax and now that it's a reality, Barnett says “it's a killer.”
That's because even though Mercedes Medical doesn't manufacture equipment or devices, the Food and Drug Administration considers the company an importer of record. Barnett says importing medical equipment represents about 25% of the company's overall business. That portion will now be taxed 2.3%
Barnett estimates the tax will cost Mercedes Medical $150,000 to $200,000 this year. “We are not passing this on to the consumer,” Barnett says. “We will take the hit.”
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