China trade war will hit hospitals in the wallet, medical supply company says

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The U.S. trade war with China threatens to hit hospitals and health systems as well as consumers in the form of higher prices and product shortages, the president of medical supply distributor DealMed told Yahoo Finance.

On Sept. 1, President Donald Trump imposed a 10 percent tariff on $300 billion in Chinese imports, tacking more medical supplies on the list. And the administration is threatening to hike the current 25 percent tariff on $250 billion in Chinese imports to a 30 percent tariff on Oct. 1.

The products affected by the tariffs are used daily in physician offices, hospitals, pharmacies and by consumers at home, according to DealMed President Michael Einhorn.

“Think of products like gauze that are in Band-Aids. Think of other products like medical gloves,” Mr. Einhorn told Yahoo Finance. “Those products will be somewhat affected, somewhere between 10 percent and 25 percent.

“When you throw tariffs into the mix, we’re talking about potential shortages, we’re talking about potential price increases — not only to hospitals and big healthcare systems, but also to the consumer at home,” Mr. Einhorn said.

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Optum aims to help John Muir Health System thrive in Bay Area

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UnitedHealth Group’s Optum is partnering with John Muir Health to help the system remain independent and become more competitive in California, according to CNBC.

“Optum’s expertise and capabilities will help us expand upon the high-quality patient care we provide to the Bay Area community,” Cal Knight, president and CEO of Walnut Creek, Calif.-based John Muir Health, said in a news release. “We share common values with Optum, and this new relationship will help us further deliver on our mission to improve the health of the people we serve. We are committed to remaining independent while embracing partnerships that help us grow and serve more patients.”

Optum, based in Eden Prairie, Minn., will take over John Muir’s information technology, revenue cycle management, analytics, purchasing, claims processing and other nonclinical functions. Optum and John Muir representatives said Optum will also be involved in John Muir’s physician network ambulatory care coordination and utilization management services.

Optum will hire about 540 John Muir employees as part of the partnership.

Optum, which offers various technologies and analytic tools, told CNBC the partnership provides a model under which it can help small, struggling hospitals remain independent.

Nick Howell, Optum senior vice president, told the TV business news channel: “Optum is not in the business of owning and operating health systems. We see this kind of partnership as a model. A lot of health systems out there are facing similar cost pressures and  are trying to find ways to remain independent. We believe this is a new third option for them.”

Optum has been a big contributor to revenue growth for UnitedHealth. It also has emerged as a competitor for some hospitals as it expands its physician workforce.




Amazon’s Push in Health-Care Supply Chain Has Faded, UBS Says Inc.’s push into distribution of health-care supplies and equipment has lost momentum, according to a survey by UBS Group AG.

Hospital purchasing managers say they are buying fewer medical supplies from Amazon compared to last year, while increasing their purchases of office supplies from the online retailer, UBS analyst Kevin Caliendo wrote in a research note on Monday. One reason could be that respondents are seeing “less discounting” for medical supplies, but it’s unclear whether Amazon discounts are lower or if wholesalers offered better deals in response to Amazon’s push in the sector, he said.

UBS’s survey found that while hospitals still expect to increase their supply purchases through Amazon over the next three years, the percentage of respondents in talks for sourcing agreements with Amazon has declined to 7% from 11% last year. The bank surveyed 100 purchasing managers.

At a conference last year, hospital supply-chain executives described Amazon’s effort in the medical distribution space as still “in its infancy,” with the biggest issues relating to procedures that allow hospitals to track and trace the products they buy from vendors.