Did you know that hospital prices account for 47 cents of every premium dollar in Michigan – and are rising faster than the cost of college tuition, childcare, and housing?
Employers, working families and taxpayers in Michigan and across the country are dealing with a healthcare affordability crisis, and skyrocketing hospital prices are a big part of the problem. On April 30, the Economic Alliance for Michigan’s annual Health Purchaser Forum brought together leading employers and unions from across the state of Michigan, alongside national policy experts, to discuss solutions that can make the system work better for everyone.
They drew attention to the healthcare affordability challenges facing businesses and workers in the state. Panelists and attendees discussed the growing need for greater transparency, accountability and competition in the hospital market to rein in high hospital prices and lower costs for working families.
Here’s what they said:
On 340B drug pricing program driving up costs for Michigan employers:
- “When hospitals say that 340B does not cost taxpayers, that’s a red flag. There is no free lunch…From 2023 to 2025, 340B in Michigan grew from 16% to 21%, costing hundreds of millions of dollars to [public- and private-sector] employers…Not only is money being taken out of your pocket, you’re actually being pickpocketed because you’re unaware that it’s happening to you.” – Rory Martin, IQVIA
- “340B is driving drug switching that leads to upside-down pricing – where patients are paying more for a biosimilar than the reference price drug.” – Bret Jackson, Economic Alliance for Michigan and Michigan Healthcare Purchaser Coalition
- 340B drives consolidation, which has been shown to drive up prices: “The more things they buy and the more patients they run through those facilities, the more money they can make from the 340B program.” – Jackson
- “The social contract is broken. Your workers are having money taken out of their pocket and it is going to mostly wealthy health systems.” – Shawn Gremminger, National Alliance of Healthcare Purchaser Coalitions
On what employers can do to rein in 340B costs:
- “Federal 340B reform is badly needed, but in the meantime employers should be asking smart questions of their PBMS and can support the rebate model.” –Gremminger
- “The 340B Cost Calculator allows employers to better understand how 340B practices may be affecting their healthcare costs – and to educate policymakers.” – Gremminger
On what Michigan lawmakers can do:
- “We need greater transparency and oversight into where the money goes when hospitals consolidate. Many nonprofit hospital systems are acting like for-profit entities, which makes accountability even more important.”– Jackson
- “Don’t break the 340B program any further.” – Jackson
- “We need to pursue site-neutral payment reform and address facility fees. Patients are being steered toward more expensive outpatient departments, creating significant costs for employers.”– Jackson