Tariffs Are Now Reality—And Medical Groups Are Paying the Price

With President Trump back in the White House and his administration swiftly moving to reimpose and expand tariffs on imported goods, a familiar economic tension has returned—but for America’s medical group practices, the consequences are already landing hard. The new wave of tariffs, positioned as a strategic move to strengthen domestic industry and leverage global trade partners, is quickly becoming a financial burden for physicians operating on the front lines of healthcare.

“For medical group practices, the implications of tariffs are simple dollars and cents,” said Anders Gilberg, Senior Vice President of Government Affairs at the Medical Group Management Association (MGMA). But those cents are adding up fast—and there’s no way to pass them along.

Medical practices rely on a global supply chain for essential items ranging from routine clinical supplies like gloves and needles to highly specialized diagnostic and treatment technologies. With tariffs now reinstated or increased on key imports, prices on these products are rising sharply. Unlike other industries, however, medical groups can’t raise their prices to compensate. Reimbursement rates from Medicare, Medicaid, and commercial insurers are locked into multi-year contracts, and they don’t flex with market conditions—especially not sudden, politically driven ones.

This creates an impossible equation for physicians: absorb the higher costs or cut somewhere else—often in staffing, technology investment, or patient access. “Practice expense calculations in fee schedules within commercial contracts and government programs…are already fixed and won’t account for any cost increases resulting from new tariffs or taxes,” Gilberg explained. In other words, there’s no cushion.

What makes this particularly dangerous is the timing. Medical groups are still reeling from the ripple effects of COVID-19: years of staffing shortages, inflation, and declining Medicare reimbursement have left many on the financial edge. Now, with tariffs pushing overhead even higher, practices that barely made it through the pandemic may not survive this next test.

The closures won’t be limited to private, independent clinics. Even larger medical groups affiliated with health systems are bracing for operational shakeups. And in rural or underserved areas—where small practices are often the only source of care—patients will bear the brunt of the fallout. Fewer clinics mean longer travel times, delayed care, and overburdened emergency departments.

The Trump Administration argues that tariffs are essential to revitalizing U.S. manufacturing and countering unfair trade practices. Those may be laudable goals—but in the meantime, physicians are footing the bill, and patients will pay the price in care delays and reduced access.

“If implemented as proposed, the potential consequences of tariff-induced cost increases may be severe, especially for medical practices struggling to keep their doors open,” Gilberg warned. That warning is no longer theoretical. The tariffs are here. The costs are real. And unless exemptions or policy adjustments are made quickly, the health of our medical infrastructure—and our communities—is at risk.

A resilient healthcare system cannot be built on the backs of underfunded, overburdened medical groups. If we value access to quality care, our economic and trade policies must reflect that. Because in healthcare, every policy decision eventually becomes a patient outcome.