Highlights
- The American Hospital Association calls for exempting critical minerals used in medical devices from tariffs to prevent potential healthcare technology disruptions.
- Rare earth elements are crucial for advanced medical equipment like MRI, CT, and radiation therapy systems.
- Over 90% of supply chain professionals anticipate potential procurement challenges regarding these elements.
- The U.S. medical device industry heavily relies on imported rare earth elements.
- The sector is vulnerable to potential tariff-related cost increases and supply chain constraints.
The American Hospital Association (AHA) has called on the U.S. Department of Commerce to exempt critical minerals (opens in a new tab) and their derivatives used in medical devices from current and future tariffs. In a letter dated May 16, the AHA stressed that rare earth elements (REEs) and related inputs are essential for advanced diagnostic and therapeutic equipment—such as MRI, CT, PET scanners, and radiation therapy systems.
According to a recent industry survey, with hospitals locked into fixed-rate payer contracts, rising costs from mineral tariffs could spike equipment prices by over 15%. Meanwhile, 90% of supply chain professionals anticipate procurement disruptions. The AHA’s appeal underscores a growing concern: tariffs aimed at trade leverage risk collateral damage to U.S. healthcare infrastructure by constraining access to life-saving, mineral-dependent technologies.
Background
The U.S. medical device industry deeply relies on REEs for diagnostic precision and therapeutic efficacy. Elements such as gadolinium, yttrium, neodymium, samarium, and lanthanum play indispensable roles in high-tech imaging and radiation-based treatments. Gadolinium-based contrast agents are used universally in magnetic resonance imaging (MRI) to enhance the clarity of internal structures, while yttrium-90 is a key isotope in radioembolization therapies for liver cancer. Compact yet powerful neodymium-iron-boron magnets are used in MRI machines, surgical robotics, and cochlear implants, enabling miniaturization and enhanced performance.
Beyond imaging, REEs are embedded in the production of radiopharmaceuticals, essential for PET and SPECT scans that track cancer progression and neurological disorders. In radiation therapy equipment, precision beam-shaping systems rely on rare-earth-based components to focus and control ionizing radiation with sub-millimeter accuracy. Even basic surgical tools and wearable medical devices increasingly incorporate rare-earth-dependent sensors and magnets for real-time monitoring, precision control, and wireless communication.
The AHA’s warning is not hypothetical—it reflects a systemic vulnerability. The U.S. imports nearly all of its processed REEs, with China remaining the dominant supplier. Any disruption or cost inflation caused by tariffs on these materials would reverberate throughout the healthcare system, delaying equipment upgrades, increasing procurement backlogs, and potentially limiting patient access to advanced diagnostics and therapies. As rare earths become strategic assets in the broader tech and defense arenas, the medical sector risks becoming an unintended casualty unless specific exemptions are swiftly enacted.
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