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American personal protective equipment (PPE) companies are forming a lobbying group to push the U.S. away from buying Chinese-made masks, gowns and gloves.
The American Medical Manufacturers Association aims to boost domestic production of PPE to ensure that the U.S. never has another shortfall as it did at the start of the COVID-19 pandemic, when China briefly restricted exports.
“When there’s massive supply chain disruption, you can’t really count on other countries for our biosecurity, our protection,” said Dan Izhaky, CEO of United Safety Technology, which set up shop in the early months of the pandemic to manufacture N95 respirators and exam gloves.
The trade association, which officially launched on Thursday, warns that American PPE manufacturers cannot compete without major policy changes.
The group has an ally in President Biden, who has prioritized bringing manufacturing back to the U.S. and bolstering the nation’s domestic supply chain in the event of future crises.
His administration has purchased hundreds of millions of American-made N95 respirators, a huge boon for the industry. But only a small fraction came from small and emerging manufacturers, like those in the trade association.
At the same time, most hospital systems continue to buy Chinese-made PPE, despite the shortfall at the start of the pandemic, because it’s far cheaper than American-made equipment, Izhaky noted.
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In an effort to make domestically manufactured PPE more affordable, the association will push for federal tax credits and a significantly higher reimbursement rate for hospital systems that purchase American-made equipment.
Biden’s Centers for Medicare and Medicaid Services has introduced more lucrative reimbursements for American-made PPE, but Izhaky said that the rate must be higher to get hospitals to move away from Chinese products.
“Clearly, the administration is putting its money where its mouth is by helping the industrial base become established and expand,” Izhaky said. “But it’s really the demand side that needs to come in for it to be sustainable.”