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Legislative and Regulatory Update
By Eric Roath, Pharm.D., MPA director of government affairs
Health Data Utility Legislation
MPA supported House Bills (HB) 4037 and 4038 were passed out of the House Health Policy committee on May 21 with recommendation from the committee. They now await a full vote on the House floor. The bill package establishes the framework and funding mechanism for a Health Data Utility (HDU), which would expand upon the existing health information exchanges established by the Michigan Health Information Network (MiHIN). HB 4037 establishes a HDU to improve health data exchange. It mandates compliance with cybersecurity laws and sets a deadline of March 1, 2026, for selecting a Health Information Exchange to operate it.
House Bill 4038 provides funding for the HDU, starting with $6 million this year and increasing to $8 million per year by FY 2027, with adjustments for inflation. Though the legislation does not specifically identify MiHIN as the entity that will develop the state’s HDU, the organization is uniquely equipped to serve this function in the state.
Prescription Drug Affordability Board
Senate Bills 3, 4 and 5 passed out of the Senate on April 24, largely along party lines (20-15), making it clear that the legislation faces an uncertain future in the Republican-led House of Representatives. Parties supporting the legislation identify the need for something to be done to curb rapidly rising prices on brand-named prescription medications, while others point out the significant cost to taxpayers and the lack of discernible outcomes from states that have already implemented Prescription Drug Affordability Boards of their own.
The most notable feature of a PDAB is its ability to impose an “upper payment limit (UPL)” on medications determined to have been subject to an excessive increase in cost. The legislation relies on the concept that market forces would subsequently adjust the pricing of that drug all along the supply chain. Michigan’s legislation contains a unique feature in that it includes a price floor where independent pharmacies (those owned by individuals with an ownership stake in seven or fewer stores) must be reimbursed at the UPL. MPA submitted written testimony during a committee hearing in the Senate on April 23 stating that it is imperative that all pharmacies be reimbursed at the UPL and that reimbursement includes a professional dispensing fee.
State Level 340B Protections
Senate Bill 94, which would codify the 340B federal drug pricing program, cleared the Senate 33-6 on March 6 with broad bipartisan support, although one opponent said more needs to be done to ensure the program is doing what it is intended to do.
The program requires pharmaceutical manufacturers that participate in Medicaid to sell outpatient drugs at discounted prices to health care organizations that care for uninsured and low-income patients. SB 94 aims to incentivize providers to fully comply with the federal law as well as protect consumers from being subject to collections by providers that are out of compliance with federal requirements.
Sen. Sylvia Santana, D-Detroit, who voted no on both bills, said SB 94 "fails to address the real concerns about transparency, accountability and, most critically, ensuring that this program serves the patients that need it most."
"I hope that this bill moves forward and my colleagues in the House will take a serious look at these concerns and work to strengthen this legislation," Santana said. "If we are serious about addressing systemic inequities, then we will need to ensure that programs like 340B are working as they are intended to work, not as a revenue stream, but as a lifeline to patients who need the help the most."
Brian Peters, CEO of the Michigan Health and Hospital Association, in a statement, thanked the Senate for its votes and urged the House to do the same. "This bill prevents drug manufacturers from continuing to issue arbitrary restrictions on 340B eligible Federally Qualified Health Centers and hospitals," Peters said. "We continue to be grateful for the Senate's leadership and collaboration in recognizing the need for strong, quality health care providers over out-of-state prescription drug interest groups."
MPA and its members continue to push grassroots advocacy efforts encouraging legislators to advance this legislation, which would prohibit a manufacturer, wholesaler, or distributor from “denying, restricting, prohibiting, conditioning, discriminating against, or otherwise limiting the acquisition of a 340B drug by, or the delivery of 340B drug to, a pharmacy that is under contract with or otherwise authorized by a 340B entity to receive a 340B drug on behalf of the 340B entity."
The MPA Advocacy Action Center has been updated to facilitate messages directly to Michigan House members. Please take the time to click the link and tell your elected official about the important efforts funded by the 340B program in your community.
Coverage of Immunizations and Test-to-Treat Programs under Pharmacist Authority
Senate Bill (SB) 107, sponsored by Sen. Santana, passed out of the Senate on April 22 by a vote of 34-2. The bill requires insurers to cover immunization and test-to-treat services rendered under a pharmacist’s independent authority to be covered by insurers contracted with that pharmacy. The bill now moves to the House of Representatives and will likely be referred to the committee on Health Policy chaired by Rep. Curtis VanderWall, R-Ludington.
The bill’s advancement comes at a critical time with the progression of the required amendments to the Pharmacy General Ruleset. On April 16, the Board of Pharmacy voted to advance the proposed rule changes along the promulgation process. The draft rules, which contain proposed training requirements for immunization, test-to-treat and hormonal contraception services, are expected to be available for public comment sometime this summer.
MPA’s Advocacy Action Center has been updated to allow you to send letters to your state representatives encouraging action on this important issue. We cannot express strongly enough how much you taking a few minutes to send a form letter to your legislator helps advance our causes. Please take the time and reach out to your state representative today.
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