Michigan Gov. Whitmer Signs Bipartisan Bills to Reduce Prescription Drug Prices

by Scott McClallen


Gov. Gretchen Whitmer on Wednesday signed into law three bills aiming to reduce the price of prescription drugs.

“I am proud to sign this bipartisan legislation that helps us lower the cost of prescription drugs,” Whitmer said in a statement. “For too long, unlicensed pharmacy benefit managers have been able to engage in practices that drive up costs for Michiganders whose lives and health depend on critical prescription drugs like insulin. This bill brings much-needed transparency to our healthcare system and is a testament to what we can do when we put Michiganders first.”

House Bills (HB) 43484351, and 4352 aim to lower the costs of prescription drugs.

HB 4348 tasks the Department of Insurance and Financial Services (DIFS) to license pharmacy benefit managers (PBMs). The bill requires PBMs to file transparency reports and bans them from practicing “spread pricing” — driving up reimbursement costs for prescription drugs and from signing “gag clauses.”

The PBM must “provide a reasonably adequate and accessible” retail network and would prohibit them from charging a pharmacy to process claims electronically, as well as regulate steps before hiking certain drug costs.

HB 4351 will prohibit a PBM or carrier from requiring a patient to pay a co-pay higher than the cost of the drug dispensed.

HB 4352 requires pharmacists to provide the price of a drug or comparative, generic drug without being asked.

A Senate Fiscal Agency report estimates an annual program cost at $330,000 – or $110,000 per three additional full-time equivalent DIFS employees to administer the PBM licensure program. However, exact costs vary. The bill would allow PBM program to administer fines and fees, but it’s unclear if that revenue would completely offset expenses.

Meijer President and CEO Rick Keyes welcomed the bill’s passage.

“Meijer cares about the communities we serve and are proud to support this legislation, which will help lower the costs of quality medications for our 2.2 million Michigan pharmacy customers,” Keyes said in a statement. “Our 2,200 Michigan Pharmacy team members work hard to serve these customers, from dispensing 18 million prescriptions to administering 1.8 million COVID-19 vaccines throughout Michigan. This bill makes pricing practices fairer, increases transparency, and helps our customers afford the medications they need to live healthy lives.”

The GOP-dominated Senate approved the bill on Feb. 16, 2022.

“In 2017, 32% of Michigan residents stopped taking their medication as prescribed due to the cost,” bill sponsor Rep. Julie Calley said in a statement. “This impactful new law will directly improve the affordability and access of prescriptions. It also adds much needed transparency into our healthcare system.”

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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.
Photo “Gretchen Whitmer” by Gretchen Whitmer. 



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