The Impact of New Tariffs on Medical Supplies Strategies to Mitigate Cost Increases and Product Availability

Tariffs imposed on medical supplies have significantly impacted and will continue to impact the healthcare industry, affecting pricing, availability, and reliability of essential medical goods. These tariffs, targeting various countries, have substantial implications for healthcare providers in the United States.

Several leading US medical device companies operate manufacturing facilities for key product categories outside the country. By leveraging their global manufacturing capabilities, these companies ensure the availability of medical devices and maintain competitive pricing, despite challenges posed by tariffs and supply chain disruptions. This paper presents examples of affected product categories and impacted countries, explores the impact of these tariffs, and offers strategies to mitigate and adjust costs.

Tariff Impacts

Increased costs: Tariffs act as import taxes, inflating the costs of medical supplies. Hospitals and healthcare providers are witnessing price hikes in commonly used products such as personal protective equipment (PPE), disposable medical devices, diagnostic equipment, and surgical devices.

Supply chain disruptions: The healthcare supply chain, already fragile from the pandemic, faces further strain. Tariffs can lead to procurement delays and shortages, affecting patient care and operational efficiency. Many manufacturers are pausing shipments to understand what the total impact on pricing may be based on high tariffs.

Dependence on foreign manufacturers: Many medical supplies are sourced from other countries that have high-volume production capabilities and low-cost raw materials. Tariffs on these imports directly impact the cost and availability of finished products and components used in US-based assembly.

Raw material impacts: Many US-based manufacturers rely heavily on internationally sourced raw materials from Asia. Disruptions will trickle down to home-based production facilities that will need to find alternative sources for raw materials such as rare earth metals, steel and aluminum, rubber, nitrile, and other plastics and polymers used to manufacture products like gloves, syringes, and tubing.