Healthcare providers and industry analysts are expressing serious concerns following President Donald Trump’s announcement of extensive tariff measures that will affect medical supplies and equipment across the board. The new policy, revealed Wednesday, implements a universal 10% tariff starting April 5, with additional country-specific duties beginning April 9.
The measures will impact essential medical items ranging from basic supplies like needles and catheters to sophisticated diagnostic equipment and diabetes monitoring devices. While pharmaceuticals received exemptions, medical device manufacturers and healthcare facilities face significant challenges ahead.
Healthcare organizations, including the American Hospital Association (AHA), had previously sought exemptions for medical supplies, warning that many supply chains couldn’t be easily relocated to domestic sources. The AHA continues to advocate for medical device exemptions, with support from AdvaMed, a major medical technology trade
association.
The financial implications for healthcare providers could be substantial. Providence health system estimates annual costs between $10-25 million due to the tariffs. Healthcare facilities are particularly vulnerable since most cannot readily pass increased costs to patients due to existing payer contracts.
The timing is especially concerning as the healthcare sector continues to grapple with supply chain disruptions. The recent Hurricane Helene damage to a North Carolina facility, which affected 60% of the nation’s IV solution supply, has already strained resources. Florida Hospital Association’s CEO Mary Mayhew noted that hospitals face limited options, as maintaining large inventories isn’t financially viable and many supplies have restricted shelf lives.
Medical device manufacturers, particularly those in the diabetes technology sector, appear most exposed to the tariffs’ effects. Companies like Dexcom, Insulet, and especially Tandem Diabetes, which relies heavily on international manufacturing, may face significant challenges. According to Morningstar analyst Debbie Wang, these measures represent a departure from historical practices that typically exempted critical medical devices.
Some larger medical device companies, including Boston Scientific and Edwards Lifesciences, may have more flexibility to adjust their manufacturing locations to minimize tariff impacts. However, Jefferies analysts note that finding alternative manufacturing locations could prove difficult given the tariffs’ broad scope, though companies with existing operations in Mexico or Canada may fare better as these countries aren’t subject to new levies.
Medical practices, already dealing with Medicare reimbursement reductions and post-COVID inflation, face additional strain. Anders Gilberg of the Medical Group Management Association emphasized that practices have limited ability to absorb higher costs while
maintaining operations.
However, some analysts, including those at J.P. Morgan, suggest that existing fixed-price contracts may provide temporary shelter from immediate cost increases. Northwell Health, for instance, doesn’t anticipate immediate effects due to current contract terms.
Industry experts anticipate clearer impact assessments in 2026 as purchasing contracts come up for renewal. William Blair analysts note that while many device manufacturers project minimal earnings effects initially, long-term implications remain uncertain due to questions about tariff duration, potential exemptions, and healthcare demand patterns.
The AHA’s vice president for quality and patient safety policy, Akin Demehin, acknowledges the administration’s goal of strengthening domestic supply chains but emphasizes the need to balance this against maintaining consistent patient care. With providers already concerned about potential Medicaid cuts, the cumulative impact of these measures could significantly affect healthcare delivery nationwide.