American Action Forum: Trade war with China could drive medical equipment costs up $400M per year

President Donald Trump's tariffs on Chinese goods will increase healthcare costs, and this increase will be shouldered primarily by healthcare consumers, according to a report from the center-right nonprofit American Action Forum.

President Trump imposed tariffs July 6 on $34 billion of Chinese goods, with an additional $16 billion that could go into effect pending public comment. When China retaliated by imposing tariffs on U.S. exports, President Trump countered July 10 with a proposed 10 percent tariff on $200 billion more of Chinese goods.

The first wave of tariffs — on a total of $50 billion in goods — could increase costs to consumers by $11.5 billion per year, according to an analysis by AAF. If the additional tariffs on $200 billion of imports go into effect, prices could grow $20 billion more per year.

In terms of impact on the healthcare industry, AAF estimates the tariffs, taken together, could affect almost $1.8 billion of medical imports each year. AAF projects that this would increase the cost of medical equipment by about $400 million, with the burden of the increased costs falling on providers and consumers. However, AAF notes providers would likely push these costs onto patients by increasing the cost of care. The ultimate financial effect on patients will depend on insurance coverage. AAF projects those with Medicare coverage will be unaffected, but those without insurance or with greater out-of-pocket responsibility can expect the greatest change.

Read the full report here.

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