The Trump administration, through the Office of the United States Trade Representative, has proposed additional duties on products from 60 economies after alleging they failed to impose or effectively enforce prohibitions on goods produced with forced labor.
USTR said it initiated 60 investigations March 12 — widely seen as legal groundwork for replacing the expiring Section 122 tariff with more durable trade authority ahead of its July 24 expiration date. Of the 60 economies investigated, 54 were found to lack a forced labor import prohibition entirely; six others were found to have a prohibition on the books but were found not to be enforcing it, according to a June 2 Federal Register notice. USTR concluded both situations constitute unreasonable burdens on U.S. commerce and warrant trade action under Section 301 of the Trade Act of 1974.
Proposed duty rates break down as follows: Economies with some form of prohibition or a related commitment under a reciprocal trade agreement would face 10% additional duties, all others would face 12.5%. USTR also proposed a mechanism that would allow a specified volume of apparel and textile imports from certain trading partners to enter the U.S. at a reduced Section 301 rate.
For health systems, the proposals deepen an already fraught procurement environment. About 69% of medical devices marketed in the U.S. are manufactured solely overseas — including commonly used items such as anesthesia instruments, syringes, pulse oximeters and sterile drapes — and many sourcing countries are among the 60 economies now under review.
According to the American Hospital Association’s 2026 Environmental Scan, 82% of healthcare executives already expect supply costs to rise by as much as 15%, and nearly all anticipate disruptions to procurement. In October 2025, the AHA warned that tariffs could disrupt access to PPE, diagnostic tools and single-use instruments essential to daily care delivery, and urged the White House to grant exceptions for goods already in shortage. Industry groups such as AdvaMed have also reported that earlier rounds of tariffs have already increased operating expenses and squeezed R&D budgets, with smaller manufacturers particularly vulnerable to the sourcing shifts required to adapt.
Unlike branded pharmaceutical companies — which have negotiated pricing and manufacturing deals to reduce or avoid the 100% drug tariff taking effect July 31 — device and supply manufacturers operate on thinner margins and are less positioned to absorb or offset new duties. Pre-negotiated contracts make passing on cost increases more difficult for providers.
The Trump administration launched the Section 301 investigations — a trade law mechanism that allows the U.S. to impose tariffs in response to foreign trade practices deemed unfair or harmful to American commerce — and expects to conclude them around the July 24 expiration of the current Section 122 tariff, which has served as a bridge to more durable trade authority.
USTR will hold public hearings beginning July 7 in Washington, D.C. Written comments are due July 6, and requests to appear are due June 22.
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