Michigan Governor Gretchen Whitmer signed House Bill 4348 (“Bill”) into law on February 23, 2022 to lower the costs of prescription drugs for Michiganders, ensure that pharmacists can provide honest advice to patients about treatment options and hold pharmacy benefit managers (PBMs) accountable. In signing the Bill into law, Governor Whitmer stated:
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.
As previously discussed by Frier Levitt, Michigan’s new Bill provides for the licensure of PBMs, will increase transparency and provide protections to independent pharmacies when it takes effect on January 1, 2024 by:
- Clearly defining the term “Maximum Allowable Cost” (MAC);
- Limiting the ability of PBMs to continue to assert that MAC lists are confidential;
- Requiring a PBM to communicate the final reimbursement amount at the point of sale;
- Prohibiting PBMs from reimbursing a non-affiliated pharmacy an amount less than an affiliated pharmacy for the same service; and
- Establishing a reasonable appeals process for pharmacies to challenge PBM conduct.
Note that the Bill is set to take effect on January 1, 2024 not January 1, 2023 as was the case in prior versions of the Bill until a recent amendment was made to the Bill during the legislative process. Independent pharmacies in Michigan should take steps now to become familiar with the Bill so that they are prepared to take action, if needed, when the Bill takes effect in early 2024.
How Frier Levitt Can Help
Frier Levitt represents numerous pharmacies across the United States in challenging PBM audits, network access, reimbursement practices and has extensive knowledge on all aspects of the pharmacy-PBM relationship. Contact us today to speak with an attorney about how your pharmacy can leverage the various laws and protections afforded to pharmacies, including state PBM laws in effect in numerous states, including Michigan, in addition to important federal laws which regulate PBM conduct.
