Will Obamacare Tax Your iPhone as a Medical Device?

Food and Drug Administration official addresses concerns that the agency will impose heavy regulations on consumer devices in health IT rulemaking and discusses possibility of iPhone tax under Obama's health care law.

By Kenneth Corbin
Fri, March 22, 2013

CIO — A senior official at the Food and Drug Administration yesterday strongly pushed back against congressional concerns that the federal government could begin taxing and regulating consumer mobile devices like iPhones and iPads through expanded federal oversight of health technologies.

Christy Foreman, director of the FDA's Office of Device Evaluation, sought to assure members of a House subcommittee that the agency's regulations for mobile health devices and applications will not extend to general-purpose products like smartphones and tablets sold at retail.

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Similarly, Foreman said that there are no plans underway to extend a medical-device tax provided for in President Obama's healthcare law to smartphones and other mobile products geared for general consumer usage, even if those devices facilitate an increasing number of health-related applications. Further, the provision in the law that exempts retail medical devices would further shield consumer mobile product from the tax.

On the regulatory side, several Republican members of the Energy and Commerce Committee said they were worried that a set of draft guidelines the FDA issued in July 2011, if not sufficiently narrowed, could be applied to a wide swath of apps and devices.

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Tax Would Apply to Small Amount of Mobile Apps

In her testimony, Foreman affirmed that the guidelines, whic

h the FDA intends to finalize by Sept. 30, the end of the federal government's fiscal year, would apply only to "a small subset of mobile apps."

"Just as importantly as what our policy proposes is what our policy does not propose," Foreman said. "It would not regulate the sale or general consumer use of smartphones or tablets. It would not consider entities that exclusively distribute mobile medical apps, such as the iTunes App Store or the Android Market, to be medical-device manufacturers. It would not consider mobile platform manufacturers to be medical-device manufacturers just because their mobile platform could be used to run a mobile medical app regulated by the FDA."

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Likewise, Foreman explained that developers of mobile apps would not have to submit new versions of their products to the agency for reevaluation if they have only made "minor, iterative product changes." Also excluded from the more stringent FDA oversight would be health-oriented apps that carry scant risk, like a pedometer app, or apps that function as electronic health-record systems.

Thursday's hearing was the third session that the Energy and Commerce Committee convened this week to examine health IT issues, reserving the final day for administration officials after hearing from members of the medical and technology communities earlier in the week.

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