Michigan Senate Moves to Fortify 340B Drug Program Protections
In a significant step, the Michigan Senate has voted to bolster protections for healthcare entities involved in a federal drug affordability initiative, the 340B Program. This program, vital for institutions such as children’s hospitals and cancer centers, enables them to procure medications at reduced prices through collaborations with pharmacies. According to federal rules, participation in Medicaid necessitates drug manufacturers’ involvement in the 340B Program.
The latest legislative measures passed aim to restrict pharmaceutical companies from curbing access to medications covered under this program. Elizabeth Kutter from the Michigan Health and Hospital Association emphasized the crucial role these savings play for healthcare providers serving underprivileged regions.
“They’re able to use 340B to ensure that cancer care is local. So, if you’re a patient and you live in and around that community, it means you can drive 15 minutes to get cancer care instead of 45, or an hour or two hours to the next closest hospital nearby,” Kutter highlighted.
Despite these advantages, pharmaceutical companies have expressed concerns over the growing number of pharmacies and healthcare providers enrolling in the program. They argue that some large hospital systems in affluent areas are benefiting from these savings without passing the benefits to the patients who need them most.
PHRMA spokesperson Stami Turk criticized the legislation in an emailed statement: “The negative implications of states like Michigan solidifying the 340B hospital medicine markup program is more than what meets the eye. Right now, big tax-exempt hospitals and clinics continue to abuse this federal program to charge huge markups on medicines to boost their profits. This is bigger than just two industries fighting: patients, taxpayers and employers are all negatively impacted by hospital markups. This legislation does nothing to help low-income and uninsured patients get access to critical medicines and allows hospitals free rein to markup medicines. Now is the time for transparency and accountability to stop this greedy behavior.”
Kutter refuted these claims, stating that the 340B program is already under stringent federal oversight and requires entities to prove their eligibility, which inherently serves highly vulnerable patients.
The Senate’s bipartisan-backed bills have passed with broad support. One focuses on preventing drug manufacturers from restricting drug access, while another mandates hospital compliance with specific drug pricing transparency laws for debt collection, potentially making Michigan’s regulations distinct.
Nevertheless, some dissent exists. Senator Sylvia Santana (D-Detroit) voiced her reservations, noting the bills’ failure to ensure direct patient benefits. “It does not require covered entities to explain how they spend their savings. It does not ensure that 340B dollars go towards charity care or other critical services that underserved patients need,” Santana remarked during a Senate session.
With the Senate’s approval, the legislation now advances to the Michigan House for further consideration.
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