The Biden administration's decision to raise Chinese tariffs on a wide range of goods could boost domestic manufacturing and lessen worries about the safety of products healthcare providers use daily — or it could raise prices.
The U.S. has imported $14.9 billion in medical equipment in 2024, compared with $14 billion at this time last year, according to the Census Bureau.
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The U.S.' reliance on China for medical products became apparent during the COVID-19 pandemic. More recently, there are safety concerns about the quality of medical products imported from China. In November, the Food and Drug Administration said it was evaluating certain plastic syringes made in China for potential device failures. In March, it began issuing warning letters to Chinese manufacturers and advised providers to discontinue using certain products.
Here's what to know about the increased tariffs on medical products.
How are medical products affected by the increased tariffs?
Chinese imports of syringes, medical masks, respirators and gloves will see higher tariffs, although the size of the increases and when the hikes will take effect vary. Syringes and needles, which currently carry no tariff, will be taxed at 50% this year. Also this year, the tariff on respirators and face masks will increase to 25%, from a current range of 0 to 7.5%. The tariff on rubber medical and surgical gloves will increase to 25% in 2026, from the current 7.5%
Steel, aluminum and semiconductor tariffs also will increase, which could disrupt production of hospital beds, surgical equipment and other medical devices, according to Soumi Saha, senior vice president of government affairs at Premier, a healthcare group purchasing organization and consultancy.
Could the tariffs lead to product shortages?
The longer lead times for some of the tariffs could lessen potential disruptions, Saha said.
However, specific products may have more at risk than others. Healthcare industry manufacturers in need of materials such as steel and semiconductors will find the competition for these products greater.
China also has a large hold on the market of rubber exam gloves, which is why gloves have the longest stretch of time before tariffs take effect. China also dominates the manufacturing of face masks.
The FDA, if it undertakes lengthy reviews of U.S. makers and their products, could exacerbate any supply chain disruptions.
How will the tariffs affect U.S.manufacturers?
Domestic manufacturers will be ready to step up to meet the increased demand much in the same way they did during the COVID-19 pandemic, said Eric Axel, executive director of the American Medical Manufacturers Association.
Thomas Allen, a managing partner for Altor Safety, a Valley Cottage, N.Y.-based manufacturer of disposable respirators and surgical masks, said the company is ready to grow to meet increased needs. However, the ability to grow largely will be determined by distributors and whether they shift toward domestic sourcing since most healthcare providers buy from distributors, Allen said.
Could the cost of medical products increase?
Unless tax credits and other financial incentives are put in place to offset the costs of moving operations to the U.S. or elsewhere outside of China, prices will rise, Premier's Saha said.
The American Hospital Association said that while it supports more domestic manufacturing, these increased costs could hurt hospitals.
"[The AHA] is concerned that these tariffs will lead to higher prices for high-volume medical supplies such as [personal protective equipment] and syringes that will exacerbate and prolong the financial headwinds that hospitals face today," said Roslyne Schulman, the trade group's director of policy, in an email.