Article

What's Behind the Latest Round of Healthcare Supply Cost Increases?

December 15, 2025
A male and a female doctor consulting
Non-acute providers are experiencing growing complexity and evolving challenges while managing healthcare spending. Global economic uncertainty, unstable supply chains, rising costs and new technologies are some of the driving forces impacting healthcare providers. 

“One especially volatile issue currently is tariffs,” said Dan Kistner, PharmD, Senior Vice President and General Manager, Spend Management, Vizient, Inc., in a Spend Management Outlook. “Shifting trade policies and new tariff actions are creating cost pressures across numerous product categories, adding a layer of unpredictability you can’t afford to ignore.”

The latest Spend Management Outlook from Provista contracting partner Vizient offers the best estimate of price increases for healthcare supplies, capital equipment, purchased services and pharmaceuticals between January and December 2026. Released in the summer of 2025, the Outlook projects an overall 2.41% price increase, up slightly from the 2.3% forecast in the winter 2025 Outlook.
 
For non-acute healthcare providers, the Outlook offers fresh insights and a roadmap for strategic planning. It highlights how all aspects of supply play an essential role in clinical performance, financial health and patient satisfaction for facilities, and offers solutions to contain spending.

WHY MEDICAL SUPPLIES ARE EXPERIENCING PRICE INCREASES
  • Rising raw material costs due to supply constraints, increased global demand and geopolitical instability.
  • Freight and shipping expenses are still above historical norms due to labor shortages, fuel cost volatility and ongoing disruptions at key shipping ports.
  • Persistent product inflation for healthcare items. This includes projected increases of:
    • 3.34% for indirect spend and purchased services
    • 2.58% for medical and surgical products
    • 2.08% for capital and imaging equipment
    • 1.68% for laboratory equipment and consumables
  • Drug shortages remain a concern, with targeted contracting strategies needed to mitigate the projected 3.35% overall drug price inflation increase.
  • Tariff uncertainty poses a potential for increases in some supply categories.
  • Growing demand for outpatient laboratories. Sg2, a Vizient company, forecasts an increase in routine diagnostics in primary care and specialized testing within medical and surgical (Med/Surg) subspecialties. Lab testing volumes have experienced a 3% year-over-year increase, resulting in approximately 2.6 billion lab claims submitted each year in the U.S.
  • A shift toward ambulatory care. Care continues to move from acute to non-acute settings.
  • Aging population and advanced testing are driving up demand for lab tests, with overall lab price inflation projected at 1.68%. 

WHAT TO EXPECT OVER THE NEXT YEAR

Looking ahead, cost increases will continue across many areas. Here are some key trends and strategies:

  • Planning will be critical to balance any needed upgrades in imaging systems, patient monitoring technology and mobile diagnostics with a facility’s financial situation.
  • Laboratory trends point to a growing use of molecular technology, highlighting its importance in rapid infectious disease detection, precision oncology and complex diagnostics.
  • A move toward digital pathology means health systems are increasingly adopting digital pathology to modernize diagnostics, enhance efficiency and address workforce shortages.
  • Technology adoption is poised to accelerate in areas such as mobile imaging, application rationalization and cybersecurity.  
  • The accelerated expansion of robotic-assisted surgery in ambulatory surgery centers is driven by small, efficient platforms that are redefining operational models, enhancing physician engagement and intensifying competition in outpatient markets.
  • GLP-1 therapies such as tirzepatide and semaglutide have rapidly emerged as significant “drivers of change” in obesity, diabetes and cardiometabolic care. This is reshaping prescribing patterns, payer strategies and patient demand. Among Provista and Vizient pharmacy program participants, tirzepatide spending surged by 167% in 2024, compared to 2023.

For non-acute organizations, embracing technology and supply chain modernization is necessary to help mitigate cost increases without affecting quality of care. The coming year will demand agility, resilience and cross-functional cost management to sustain care and offset market-driven price increases.

THE RISE OF HEALTH SYSTEM-CONTROLLED DISTRIBUTION

An emerging shift in the healthcare supply chain is the move toward health system-controlled distribution operations. By 2028, more than 20% of health systems are expected to manage or operate aspects of their own distribution, either through in-house capabilities or outsourced warehouse solutions.
 
As noted in the most recent Spend Management Outlook, this trend reflects a broader movement toward decentralizing traditional supply chain models. Med/surg distributors, in response, are increasingly promoting their private-label products with incentives such as zero distribution fees tied to minimum purchase thresholds. While this may seem appealing at first glance, these arrangements carry the risk of off-contract purchasing if a distributor withdraws product support.
 
To help clients address these challenges, Provista and Vizient actively assess strategies to maintain contract integrity and minimize risks. This helps ensure continuity and reliability for med/surg.

“By leveraging Provista solutions, non-acute providers can strengthen resilience, stabilize pricing and protect patient care from market volatility.”

THE ROLE OF ARTIFICIAL INTELLIGENCE IN CONTAINING INDIRECT SPEND

As noted in the winter 2025 Spend Management Outlook, healthcare spending on AI surpassed $184 billion globally in 2024, and adoption is accelerating. In a July 2024 Vizient survey, 89% of respondents said they had implemented AI within the past 12 months.
 
While much of the conversation about using AI in healthcare focuses on clinical applications, it also affects indirect spending, too. This includes areas such as environmental and food services. Healthcare facilities can use AI to:

  • Reduce labor costs for services that don’t require direct human interaction.
  • Optimize workflows in diagnostic imaging, correcting image orientation errors while improving speed and quality.
  • Reallocate staff to patient-facing roles, boost efficiency and contain operational costs.

Successful implementation requires careful planning. Collaborating with vendors to quantify cost savings, piloting AI in targeted areas, and evaluating peer recommendations and case studies from other facilities that are using it help ensure AI delivers the anticipated value.

PROVISTA SOLUTIONS TO CONTROL COSTS

As market pressures mount and costs are expected to increase, Provista and Vizient have proven solutions to help improve efficiency and spending:

  • Novaplus®, the industry’s longest-running private label program, delivers market-leading value to providers.
  • Novaplus Enhanced Supply (NES) program delivers a pooled inventory of both Novaplus private label and manufacturer-labeled essential medications.
  • NES Reserve secures a dedicated inventory of critical drugs.
  • Supply Assurance ensures providers have the products they need, even in times of disruption, giving them confidence in their inventory.
  • Drug shortage resources include drug shortage alerts and mitigation strategies.

By leveraging these solutions, non-acute providers can strengthen resilience, stabilize pricing and protect patient care from market volatility.

You Might Also Like

Ready to Get Started?

Take the next step to start saving.

Become a Member