American Hospital Association says White House should grant tariff exceptions

Photo: Walter Bibikow/Getty Images

The American Hospital Association has sent a letter to the Trump Administration urging it to consider exceptions to the proposed tariffs on medical devices and pharmaceutical products from China, Canada and Mexico.

These products, the AHA said, are essential to maintaining safe and effective care in the nation’s hospitals and clinics.

It’s especially critical, the group said, to implement these exceptions for products that are already experiencing shortages, and for which production in the countries subject to increased tariffs supply a significant part of the U.S. market.

“We are aware, since the announcement of the potential tariffs, conversations with the leaders of Canada and Mexico led to a delay in the imposition of tariffs on products made in those countries, but we believe the principle still prevails,” the AHA wrote.

WHAT’S THE IMPACT

The U.S. healthcare system relies significantly on international sources for many drugs and devices, the AHA said, and tariffs could reduce the availability of these medications and supplies. China, for example, provides many cancer and cardiovascular medications, immunosuppressives, antibiotics and combination antibiotics, and for many patients, a temporary disruption in access could put them at risk of harm, including death.

And it’s not just the products themselves that are important, but the raw materials for pharmaceuticals, which mainly come from China, the AHA said. These active pharmaceutical ingredients, or APIs, are the most important components of any pharmaceutical manufacturer’s supply chain, the group said, and about 30% come from China – meaning the tariffs may hamstring manufacturers in their efforts to produce drugs in the U.S.

China is also the source of many medical devices – many of them designed for single use, like blood pressure cuffs and stethoscope covers – and disrupting the availability of these instruments could hinder clinicians’ ability to perform surgeries and kep patients safe from contagion, the AHA said.

The group also cited the need to protect healthcare workers from infectious diseases – a need that requires products such as gowns, gloves, face masks and respirator, many of which are manufactured in China and can’t be easily replaced by domestic manufacturers.

“In 2023, Chinese manufacturers provided the majority of the N95 and other respirators used in healthcare,” the AHA wrote. “Additionally, China was the source for one-third of the disposable face masks, two-thirds of the non-disposable face masks, and 94% of the plastic gloves used in healthcare. “The lack of this essential equipment will not only put patients at risk but also threaten our healthcare delivery personnel.”

THE LARGER TREND

Other Republican plans include cutting Medicaid spending, ending ACA subsidies and enacting site neutral payments.

Michael Abrams, managing partner of consulting firm Numerof, said health systems have reason to worry. While Trump mentioned little about healthcare in his inauguration speech, the GOP trifecta means spending cuts outlined in a one-page document released by Politico and another 50-pager could get a majority vote for passage.

At the top of the Republican list targeting $4 trillion in healthcare spending is eliminating an estimated $2.5 billion from Medicaid.

Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.