Democratic leaders in the Senate unveiled their proposal for overhauling the health care system, which includes a new 5% tax on elective cosmetic procedures. Senate Democrats argue that the tax, which was a surprise addition to the sweeping 2,074-page bill, will generate $5.8 billion over the next 10 years to be put towards the bill’s estimated $849 billion price tag. However, this tax as discriminatory, arbitrary and ineffective.
Elective surgery taxes discriminate against women, given that 86 percent of cosmetic surgery patients are female, of which 91 percent are between the working ages of 19-64. Moreover, contrary to popular belief, cosmetic surgery is no longer an exclusive luxury afforded by the very wealthy. This tax is effectively a “Soccer Mom” tax that will adversely impact mainstream American wives and mothers, who are the majority of plastic surgery patients. (This law will tax cosmetic dentistry, teeth whitening, Botox, fillers & peels, as well as surgery.) As your doctor, I understand and appreciate the need for health care reform, but taxing physicians and cosmetic surgery procedures (ie, you) to pay for the reform is not realistic or beneficial.
In a 2005 ASPS survey of people planning to have cosmetic surgery within the next two years, 60% of respondents reported an annual household income of $30,000-$90,000 a year. Most importantly, 40% of those reported a household income of only $30,000-$60,000. Only 10% of respondents reported a household income of over $90,000, which clearly refutes the suggestion that elective surgery taxes are “luxury” or “sin” taxes affecting a privileged few.
Such taxes have been proven arbitrary and difficult to administer as evidenced by our experience in New Jersey, the only state to have imposed a cosmetic tax. Since it passed a 6% tax on elective medical procedures in 2004, the NJ Department of Taxation has experienced a 59% shortfall based on projected revenue estimates. Eight other states have considered similar tax legislation- and they all wisely rejected them. In fact, according to Joseph Cryan, the NJ State Democratic Chairman, for every $1.00 collected by the NJ tax, it costs the state $3.39! (Of course, with the new federal tax, we would pay 11% in NJ!)
Finally, though the bill claims that the only procedures that would be taxed are those that are “not necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease,” such distinctions aren’t always obvious. Because the line between ‘cosmetic’ and ‘reconstructive’ surgery is not always clear, such a tax would leave the determination of medical necessity up to state tax auditors – a completely inappropriate proposition.
The American Society of Plastic Surgery has, and continues to oppose all taxes on physicians, in any and all forms, due to their deleterious effects on health care costs and access to patient care. Medical care should not be used as a tool to fix broken finances.
ASPS has developed a dedicated toll-free hotline number for you to share your thoughts with Senators Lautenberg and Menendez. Callers will hear a recorded message explaining the tax, after which they will be matched via zip code prompt with their individual Senators so that they may speak directly with their offices. Please distribute this number as widely as possible.
Paul M. Parker, MD, FACS