House passes 15-bill package aimed at curbing drug costs, increasing health care access

Beth LeBlanc
The Detroit News

Correction: State Rep. Abdullah Hammoud said the health care reform legislation put insurers, pharmaceutical companies and distributors on notice. The story has been updated to correctly identify the lawmaker.

Lansing — The Michigan House on Wednesday approved a 15-bill package that aims to curb health care costs, increase transparency on costs and expand access to patients even as business groups, health plans and doctors opposed some of the measures. 

The package will next move to the Senate where some health care providers believe it will go through a more "deliberative" process. The package passed through House committees and the full chamber by wide bipartisan margins in about a month. 

House Speaker Jason Wentworth said Wednesday's bill package was just "a step down that path of increasing accessibility and affordability." The Farwell Republican expects a second phase of health care reforms may be rolled out at a later date.

Many of the reforms voted on Wednesday had been floated in earlier sessions so the opposition from some groups was not unfamiliar, he said. 

"There are some of these stakeholders that are just never going to be supportive," Wentworth said. "And if they are supportive, I think that should raise a red flag. These bills need to be strong and they need to be aggressive in order to truly drive down costs."

The package of bills puts on notice the nation's largest insurance companies, pharmaceutical manufacturers, distributors and pharmacy benefit managers who have "nickeled and dimed our independent pharmacists and robbed our patients of rebates," said Rep. Abdullah Hammoud, D-Dearborn. 

Michigan House of Representatives is seen in this file photo from 2018.

"What is the point of having an insurance card in your wallet that you cannot use?" Hammoud said.

The bills would limit insulin and oral chemotherapy co-pays to $50 a month for insulin and $150 for oral chemo, proposals criticized by a coalition of business groups and health plans who said the bill amounted to a "cost shift" that would push the burden onto insurance premiums. 

The co-pay cap would only apply to some individuals, including about 10% of diabetes patients.

The Michigan Association of Health Plans has argued the caps on insulin and oral chemo will only shift costs to insurance premiums. The association is joined in opposition by business groups like the Michigan Chamber of Commerce, the Small Business Administration of Michigan and the National Federation of Independent Business. 

The root cause of the high cost is the manufacturer, an issue that is unaddressed in the bill package, said Dominick Pallone, executive director for the health plan association. 

"We’re all in agreement that these life-saving, life-changing drugs cost too much," Pallone said. "We certainly want to work with the Legislature on ways to make these drugs more affordable.”

Rep. Mark Tisdel, R-Rochester Hills, didn't deny the bill would result in a cost shift while speaking in support of the legislation on the House floor Wednesday. 

"That’s right, this bill shifts the pain from individuals who need it to live to the larger, well-organized and politically represented” insurers, employers and industry advocates with bigger megaphones to urge change at the federal level, Tisdel said. 

Small business insurance premiums in Michigan rested ninth in the country in 2019 and the co-pay caps could increase those by an expected $57 million, said Scott Lyon, Small Business Association of Michigan senior vice president. 

The bills would push small businesses to "face the difficult decision of cutting off insurance for their workers," Lyon said.

The bills also seek to regulate and license pharmacy benefit managers, the middlemen between drug manufacturers and pharmacies. The role was created to negotiate with manufacturers and keep drug costs low, but critics say much of drug price inflation occurs among pharmacy benefit managers. 

The "third-party administrators" have been "shrouded in secrecy and silence" and are at times more motivated by rebates a certain drug company may give them than getting the best cost and quality drugs to consumers, said Rep. Julie Calley, the Portland Republican who sponsored the bill. 

"This bill prioritizes people before profits," Calley said. "Lifesaving medication is worthless if people can afford it.”

Other bills would allow telemedicine for eye exams; require pharmacists and manufacturers to disclose prescription drug prices; require hospitals to make publicly available a list of standard charges; allow out-of-state health providers to provide telehealth services to Michigan residents; and ban drug manufacturers or distributors from giving gifts to a health care provider. 

The closest votes in the package occurred on bills to allow telemedicine for eye exams and out-of-state doctors. Both bills passed largely along party lines, 56-51.

Another bill, opposed by physician groups, would expand the scope of practice for nurse anesthetists so that they could administer anesthesia without the supervision of a physician. 

The Michigan State Medical Society opposed the legislation because it said the experience of an anesthesiologist was needed in the event of an emergency situation.