Healthcare leaders are navigating the new era of trade policy following a series of tariffs recently imposed by President Donald Trump.
Here are six takeaways on where tariffs stand now:
- As of April 5, all imports into the U.S. are subject to a 10% baseline tariff. Additional tariffs targeting countries with significant trade imbalances were set to begin April 9, but President Trump temporarily paused them for 90 days to allow for negotiations.
- The U.S. imposed steep tariffs on Chinese imports in April, peaking at a cumulative 145% following earlier trade escalations. However, after trade negotiations, in June President Trump reduced the total tariff rate on Chinese goods to 55%.
- Although pharmaceuticals were not included in the initial wave of higher tariffs, they were not exempt. President Trump confirmed at a dinner of the National Republican Congressional Committee that major tariffs on pharmaceuticals are forthcoming, stating, “We’re going to be announcing very shortly a major tariff on pharmaceuticals. And when they hear that, they will leave China. They will leave other places because they have to sell — most of their product is sold here and they’re going to be opening up their plants all over the place.”
In addition, active pharmaceutical ingredients and medical devices are subject to the baseline 10% tariff, and a Section 232 investigation is underway that could lead to additional levies on pharmaceuticals. - Hospitals across the country are bracing for a significant cost burden. Renton, Wash.-based Providence Health said it projects a $10 million to $25 million annual increase from the tariffs. A January survey of 200 healthcare providers found that 82% expect systemwide cost increases of at least 15% in the next six months because of tariff-related import expenses.
- Medical device companies, including Baxter International and GE Healthcare, are reporting significant tariff-related costs. Baxter expects a $60 million to $70 million hit this year due to tariff-related costs, and GE Healthcare forecasted a $500 million total tariff impact, revising its earnings outlook downward.
- Major healthcare organizations, including the American Hospital Association and America’s Essential Hospitals, have urged the administration to exempt medical devices and pharmaceuticals from the tariffs, warning it could worsen care access, especially in underserved areas.
