Navigating tariff uncertainty: What rural hospitals can do right now

Rural hospitals already know the meaning of financial pressure. Whether it’s declining reimbursements, staffing shortages, or rising costs for everything from medications to basic supplies, rural leaders have spent years becoming experts at doing more with less.

Tariff uncertainty is the latest challenge threatening to disrupt supply chains and drive up costs. Recent federal actions could result in new tariffs on critical health care supplies, from surgical gloves and syringes to medical devices and pharmaceuticals.

For rural hospitals, these changes could have outsized consequences due to smaller purchasing power, tighter margins, and less flexibility to absorb price hikes compared to larger health systems.

This blog breaks down what rural leaders need to know — and the practical, no-regrets steps they can take today to safeguard their supply chains and protect their financial health.

What’s driving the concern?

Earlier this year, a series of trade actions raised the possibility of new tariffs on imports from key trading partners like China, Canada, and Mexico. These tariffs wouldn’t just hit big-ticket items — they could apply to everyday essentials rural hospitals rely on, including:

• Personal protective equipment
• Medications and active pharmaceutical ingredients
• Medical devices and durable equipment
• Basic supplies like tubing, gloves, and syringes

For rural hospitals operating on razor-thin margins, even a 5 percent increase in supply costs could be devastating — particularly for independent facilities that don’t have the purchasing leverage of larger systems.

What we know — and what we don’t

As of now, there’s still a lot of uncertainty about the specifics:

• Which products will ultimately be affected?
• Will any rural-specific exemptions apply?
• How much of the cost will suppliers pass on?
• When will these changes take effect — if they do at all?

This ambiguity creates a real planning challenge for rural hospitals. But if the pandemic taught rural health care anything, it’s this: preparation beats reaction every time.

What rural hospitals should do right now

Even without all the answers, rural hospitals can take concrete steps today to strengthen their supply chains and brace for potential cost increases. These are no-regrets actions that build resilience, regardless of whether the worst-case tariff scenario materializes.

1. Assess your supply chain exposure

Start by identifying which of your most essential supplies are sourced internationally. Work with your vendors and group purchasing organization (GPO), if applicable, to trace product origins and understand which items are most vulnerable to tariffs.

For each product, ask:

• What country does this come from?
• What alternatives exist?
• How much inventory do we typically keep on hand?
• Could we source this domestically if needed?

This supply chain mapping gives rural hospitals a head start if tariffs hit.

2. Run ‘what if’ scenarios for your budget

Build out a few scenarios that estimate potential cost increases if key supply categories are hit with tariffs.

For example, if gloves and syringes go up by 15 percent:

• What’s the total annual impact on your supply spend?
• Can you offset this by renegotiating contracts elsewhere?
• Will your current cash flow cover it, or will you need to delay capital purchases to compensate?

Scenario planning gives rural leaders hard numbers to work with when talking to boards, finance teams, and clinical leadership.

3. Review contracts for tariff pass-through clauses

Some vendor contracts allow automatic price increases tied to external factors like tariffs. Others do not.

Now is the time to audit your contracts — especially any local agreements outside of your GPO coverage — to understand where you are vulnerable. In some cases, shifting products onto GPO agreements may provide stronger protections against tariff-related price hikes.

4. Engage clinicians in supply cost decisions

Frontline clinicians play a critical role in helping manage supply costs — but only if they understand the stakes.

Engage your physicians, nurses, and pharmacy teams now to:

• Identify opportunities for product standardization (fewer product SKUs = stronger negotiating power).
• Review where lower-cost clinically equivalent products could replace premium items.
• Ensure clinical teams understand supply cost visibility and why these decisions matter for the hospital’s overall sustainability.

When rural hospitals treat clinicians like partners in cost management, they find creative solutions — and build trust.

5. Build a rapid response decision team

Supply chain disruptions demand fast decisions — but that’s hard in hospitals where every purchasing decision flows through layers of approvals.

Establish a supply chain response team now. Include:

• CEO
• CFO
• Supply chain lead
• Pharmacy director
• Key clinical leaders

This team should meet regularly to review the latest tariff updates, assess risks, and agree on immediate actions if necessary. Having this team in place means rural hospitals can respond in hours — not weeks.

What rural hospitals should not do — at least not yet

There are also a few strategies that might feel tempting right now — but could create more problems than they solve if implemented prematurely:

🚫 Panic buying: Stockpiling products before knowing the final tariff details can waste limited cash and storage space — especially if the products end up not being affected.

🚫 Switching suppliers on speculation: Longstanding vendor relationships — especially ones tied to volume discounts or performance guarantees — shouldn’t be scrapped unless necessary. Premature switching could raise costs more than the tariff itself.

🚫 Assuming domestic = cheaper: Domestic sourcing reduces some risks, but often at a higher price point. Many U.S. manufacturers still rely on imported raw materials, meaning tariffs could hit them too.

A lesson from the pandemic

Rural hospitals that fared best during COVID were the ones with strong supply chain visibility, clear supplier communication, and the ability to make quick decisions when shortages hit.

Tariff uncertainty is different — but the resilience playbook is the same. Rural hospitals need to know their exposure, engage clinical and financial leaders, and act decisively when necessary.

The rural reality: Proactive beats reactive every time

Rural hospitals can’t afford to wait and see — and they certainly can’t afford to absorb unchecked price increases.

The good news? The steps rural leaders take today to prepare for tariffs will also make their supply chains stronger and smarter overall. That’s the kind of resilience rural health care needs, with or without a tariff crisis.

For additional insights and tools to build a stronger rural supply chain, visit Vizient’s Supply Assurance Program.

NRHA adapted the above piece from Vizient Inc., a trusted NRHA partner, for publication within the Association’s Rural Health Voices blog.

About the author: Vizient senior vice president and general manager of spend management Bonnie Lau offers solutions for clinical & physician preference items. She holds a PhD in biomedical engineering from Duke University and a bachelor's degree from Northwestern University in biomedical engineering and art theory and practice.