Lately, my bi-weekly calls with my 24-year-old daughter, a medical assistant preparing for med school, are starting to sound more like supply chain audits. She tells me which items are running low at her clinic and how the team is scrambling to provide quality care to patients.
Having been raised by a parent who managed global supply chains, she knows these aren’t just inventory issues — they are cracks in a fragile health care system now under further strain from President Trump’s tariffs and the uncertainty surrounding them.
Last year alone, the U.S. imported more than $75 billion in medical devices and supplies. While headlines have focused on potentially higher costs for pharmaceuticals and high-tech medical equipment, the more urgent and often overlooked concern is the availability of basic, everyday lifesaving supplies. Gloves, syringes, sterile water, IV fluids and even diapers may seem mundane, but they are the lifeblood of clinical care. Hospitals spend approximately 25 percent of their budget on these high-volume items.
Most of these essentials are imported. For example, two-thirds of non-disposable face masks and 94 percent of plastic gloves used in U.S. health care settings come from China. Already impacted by tariffs implemented last year to counter low-cost imports, these products are now becoming even more expensive.
Enteral syringes used to deliver medication or nutrition through feeding tubes are now subject to a staggering 245 percent tariff, according to one group purchasing organization. If trade tensions continue to escalate, we could see a return to pandemic-era supply shortages — or worse.
As hospitals prepare for these impacts, it’s their patients who will bear the repercussions. The American Hospital Association recently reported that 82 percent of health care leaders expect tariff-related price hikes to increase hospital costs by at least 15 percent within six months. One major health system in Washington projected that tariffs could increase annual costs by $10 to $25 million.
With Medicaid reimbursement rates set by the government and private insurance reimbursement rates held in place by contracts, hospitals can’t easily pass on these increases. Instead, they absorb the costs and find other cuts, like reducing staffing or delaying upgrades. That could mean longer wait times, postponed procedures and ultimately, worse outcomes for patients.
Rural hospitals and community providers already operating on razor-thin margins will feel these burdens most acutely. Close to 200 rural hospitals have closed in the past two decades, and nearly 700, or close to one-third of all additional rural hospitals, are at risk of closing in the near future.
When policymakers impose sweeping trade measures without fully considering downstream effects, the entire health care system suffers the consequences. The disruption often costs more than the policy itself, in both dollars and diminished patient care.
Health care policy is essential for a productive economy, which is the main goal of the president’s tariffs. Medical supplies should be exempted from tariffs. This would help to ensure more consistent pricing and ensure Americans have access to the health care essentials they need.
Policymakers can also help bring manufacturing for some of these products back home by investing in more public-private partnerships and supporting infrastructure and workforce development to encourage companies to make these goods in the U.S. Finally, the federal and state governments can reengineer the procurement processes for Medicare and Medicaid, and enact measures to ensure more efficient practices in the private sector to enable competition and fair prices.
Pharmacy benefit managers and Group Purchasing Organizations need to work on behalf of the patients, hospitals and clinics to better manage costs, similar to processes in other supply chain systems.
Overall, policymakers must understand that while tariffs may shift economic leverage, they also shift risk onto patients.
My daughter is learning this lesson on the front lines. She went into medicine to deliver care. Lately, and too often, she’s just delivering bad news.
Jack Buffington is Supply Chain Management Professor at the University of Denver.