Tariffs on Chinese products could increase annual medical equipment costs by $400M
The escalating trade war between the U.S. government and China could lead to an additional $400 million in medical equipment costs each year, according to a new analysis from the American Action Forum (AAF). The total increase to annual nationwide consumer costs is estimated to be $31.5 billion.
A quick review of how things reached this point: Tariffs on $34 billion worth of products imported from China officially kicked in earlier this month, with tariffs on another $16 billion of products expected to take effect soon. China then retaliated by lodging a complaint with the World Trade Organization and imposing similar tariffs on $34 billion worth of U.S. products. Then, as a response to China’s response, the Office of United States Trade Representative announced an additional tariff of 10 percent on $200 billion worth of Chinese products. Those tariffs are set to take effect later this year.
Fifty-five different products affected by the Trump administration’s tariffs—including x-ray, CT and MRI equipment—can be classified as medical equipment, according to the AAF. And that additional $400 million in medical equipment costs? Providers and patients may end up being the most affected.
“Both medical practitioners and consumers of medical services can expect to shoulder the burden of these costs,” wrote the AAF’s Jacqueline Varas and Tara O’Neill Hayes. “To the extent that providers face an increased cost in acquiring medical equipment, they will try to recoup those costs through higher prices to patients. The immediate impact on patients will depend primarily on whether they hold insurance, what kind of insurance they hold, and the generosity of their insurance plans.”
The AAF’s analysis indicates Medicare patients “will likely be unaffected, at least for the remainder of the year,” noting that uninsured patients and patients “with substantial out-of-pocket liabilities” may be hit the hardest.
The trade war is also expected to hit manufacturers.
“These tariffs will increase the cost of production, making it more expensive to manufacture goods in the United States, and likely place additional upward pressure on consumer prices,” Varas and O’Neill Hayes wrote.
Michael has more than 18 years of experience as a professional writer and editor. He has written at length about cardiology, radiology, artificial intelligence and other key healthcare topics.