Business
The American Hospital Association (AHA) has asked President Donald Trump to exempt medical products and drugs from proposed tariffs, citing potential interruptions to healthcare delivery.
Tariffs proposed by the administration are expected to further strain US hospitals and health systems, with changes to supply chain expenses and delays in delivery. The Healthcare Financial Management Association reported that, “there had been speculation that the tariff order would exempt healthcare items, but no such exclusion was forthcoming.”
A survey by Black Book Research found that 82% of the 200 healthcare professionals (supply chain professionals, pharmaceutical executives, distributors, and medical equipment manufacturers) who responded predict costs for hospitals and health systems will jump by at least 15% in the next 6 months because of tariffs.
Nearly 7 out of 10 (69%) respondents estimated that pharmaceutical costs will increase by at least 10% due to the China tariff on active pharmaceutical ingredients (APIs). To offset cost increases, 27% of respondents reported that they are looking for alternative domestic or international suppliers. However, 92% of pharmaceutical manufacturers warn that swapping suppliers could mean regulatory delays and supply inconsistencies.
On February 1, Trump signed executive orders placing tariffs on imports from Canada, Mexico, and China. While the United States reached deals with Canada and Mexico to delay the 25% tariffs for 30 days, a 10% tariff is currently in place on all imports from China.
In a letter to the President dated February 4, AHA President Rick Pollack wrote, “Despite ongoing efforts to build the domestic supply chain, the US health care system relies significantly on international sources for many drugs and devices needed to both care for patients and protect our health care workers.”
“Tariffs, as well as any reaction of the countries on whom such tariffs are imposed, could reduce the availability of these life-saving medications and supplies in the US,” he wrote.
Business Potential Disruptions in Cancer, CVD Care
Pollack listed examples, including implications for patients with cancer and cardiovascular diseases.
He noted that the United States imports many cancer and cardiovascular medications, immunosuppressives and antibiotics from China.
“For many patients, even a temporary disruption in their access to these needed medications could put them at significant risk of harm, including death,” Pollack wrote. “Carefully planned chemotherapy treatments and antibiotic schedules are essential to giving patients the best chance of overcoming their disease Similarly, the provision of necessary cardiovascular medications must be continuous to preserve their cardiovascular health.”
Many APIs also come from China, the letter noted. “The US gets nearly 30% of its APIs from China, meaning these tariffs may also limit the availability of US drug manufacturers to produce critical drugs here in the US.”
Business Dependence on China for Equipment, PPE
The United States also relies on devices from China such as single-use blood pressure cuffs, stethoscope covers, and sterile drapes. “Disruption in the availability of these instruments would curtail hospitals’ ability to perform lifesaving surgeries and keep patients safe from contagion and greatly reduce our ability to effectively diagnose and monitor patient conditions,” the letter stated.
Also at risk are the supplies of personal protective equipment (PPE) including gowns, gloves, face masks and respirators, and other equipment, “much of which is manufactured in China and cannot easily be replaced by domestic manufacturers,” the letter stated.
In 2023, according to the letter, Chinese manufacturers provided most of the N95 and other respirators used in the United States. Additionally, one third of disposable face masks, two thirds of nondisposable face masks and 94% of the plastic gloves used in healthcare in the United States came from China.
According to the Council on Foreign Relations, China supplies the United States with many over-the-counter and generic drugs, including HIV/AIDS medications; birth control pills; antidepressants; and medicines for diabetes, Alzheimer’s and Parkinson’s.
The Coalition for a Prosperous America reported that China has sharply increased its share of pharmaceuticals sold to the United States in recent years. “In 2021, the US imported $5.5 billion worth of pharmaceuticals from China, more than double the amount from just 5 years earlier,” the report states. “China now accounts for 95% of imports of ibuprofen, 91% of imports of hydrocortisone, 70% of imports of acetaminophen, and 40%-45% of imports of penicillin.”
The AHA’s letter praised President Trump’s attempts to crack down on the illicit drug flow in the United States, one of the stated objectives of the tariffs. However, Pollack said the AHA is concerned “that the approach of using tariffs may inadvertently put others’ lives at risk by jeopardizing the availability of vital medications and essential healthcare devices.”
Marcia Frellick is a Chicago-based independent healthcare journalist.
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