Federal Spending On Medical Supplies Tops $8.2 Billion

New HIDA Report Shows Trends In Government Procurement

Alexandria, VA, Jan. 12, 2023 – U.S. federal government spending on medical supplies exceeded $8.2 billion in fiscal year 2021, according to the first-ever Federal Procurement Market Report published by the Health Industry Distributors Association.

The U.S. federal government spend for medical supplies in fiscal year 2021 was estimated at $8.2 billion. Purchases dropped 38% from FY 2020, but remained well above pre-pandemic numbers. In FY 2021, civilian departments/agencies accounted for $4.7 billion and defense departments/agencies $3.4 billion in medical supply purchases.

“Government procurement is a large and growing market for our members,” said Matt Rowan. “This report accounts the contribution of federal spending to the medical supply chain in unprecedented detail, and underscores the importance of public-private partnerships in our industry.”

The Federal Procurement Market Report was the result of unique and unprecedented research into the medical supply chain. HIDA performed an analysis of publicly-available data of government contract awards accessible on government websites. This data is unique to the medical supply chain, as it was customized to only those government purchases of non-pharmaceutical medical supplies from healthcare manufacturers and distributors.

Among the findings:

• Agency Concentration: Nearly all (98%) of the federal government medical supply purchases fall within four departments: Department of Defense (DOD), Department of Veterans Affairs (VA), Department of Health and Human Services (HHS), Department of Homeland Security (DHS).
• Small Business Focus: In FY 2021, $2.4 billion in federal contracts were awarded to small businesses selling medical goods. An estimated thirty-eight percent of the Department of Defense (DOD) and 22% of civilian department medical supply purchases in FY 2021 were small business contracts.
• Supplier Diversity Goals: In FY 2021, diverse small businesses were awarded $1.35 billion in medical supply contracts through the programs serving Small Business Administration Socially and Economically Disadvantaged Businesses (SBA 8(a)), Service-Disabled Veteran-Owned Businesses (SDVOSB), Woman-Owned Small Businesses (WOSB), Indian-Owned Businesses and Historically Underutilized Business Zones (HUBZone).

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About HIDA

Health Industry Distributors Association (HIDA) represents the healthcare distribution network – the essential link between global healthcare supply manufacturers and local care providers. HIDA members operate more than 500+ distribution centers to bring critical products, supplies, and services to more than 560,000 healthcare settings across the U.S., including hospitals, long-term care, physician practices, home care, and laboratories. Visit HIDA.org.