MHA CEO Report — Lame Duck is Here

MHA Rounds graphic of Brian Peters

“Even though you are on the right track, you will get run over if you just sit there.” Will Rogers

MHA Rounds graphic of Brian Peters

The balance of power at both the state and federal levels will change in 2025. Yet lawmakers still have several weeks remaining, a period we refer to as lame duck where a number of elected officials finish their terms with the opportunity to pass bills and create policy prior to leaving office at the end of the year.

Republicans regained majority in the Michigan House of Representatives, changing the balance of power from Democrats controlling both the House, Senate and executive office. This scenario can create a hectic environment where the party in power attempts to push many bills through before they lose influence next term. In many instances, lawmakers may trade their support for completely unrelated bills to gain the necessary support to pass legislation.

This period keeps associations and lobbyists up late at night – both figuratively and literally, as sessions that run into the wee hours are common. The MHA remains vigilant through those many hours and votes on any issues that impact access to care and hospital’s ability to care for Michiganders. The two most important examples are separate bills that would address government mandated nursing staffing ratios and create protections for the 340B drug pricing program.

The MHA has successfully to this point held off any movement on the government mandated nurse staffing ratio legislation, which was introduced in May 2023 and received a committee hearing in the House in November of last year. These bills would severely hamper a hospital’s ability to provide care, with the potential to lead to the closure of up to 5,100 hospitals beds across the state. The MHA has dedicated significant time and resources in educating lawmakers about the practical impacts of these bills and the lengths to which hospitals are going to address workforce challenges and to support their nurses. Our “Think it Through” messaging, which includes billboards in strategic locations as well as digital advertising, is the latest addition to our multi-faceted advocacy on this critical topic. It is safe to say we are counting down the days remaining in the session while these bills remain a threat.

While our association plays defense on nurse staffing mandates, we are playing offense with respect to 340B. We continue to advocate for the passage of House Bill 5350, which would prohibit manufacturers from discriminating against program participants based on their contract pharmacy relationships. A significant number of Michigan hospitals use 340B savings as a force multiplier, allowing these hospitals to stretch incredibly scarce resources to provide care for more patients in their communities, increasing access to care and the quality of care for Michigan’s most vulnerable residents. We’re encouraged that we will see this bill move through both chambers during lame duck and hope you will lend your support to the issue by contacting your state lawmakers through our MHA action alert.

Congress will have their own lame-duck session, which has the potential to impact additional health policy. While it remains to be seen how much activity occurs on Capitol Hill, site-neutral payment policies remain a threat to access to care for patients across Michigan and the country. As with government mandated nurse staffing ratios, policies that add cost or reduce reimbursement can lead to reduced hospital beds, service lines or even potentially hospital closures.

We’re in the home stretch of the 2023-24 legislative sessions in both Lansing and Washington DC. Be rest assured that the MHA is taking every opportunity during lame duck to meet with our state and federal lawmakers, and advocate on behalf of advancing the health and wellness of our patients and communities. While 2025 will present its own unique set of challenges and unpredictability, our focus remains on these final days of session until the last gavel signifies adjournment and sine die.

The bottom line: we are on the right track with respect to our advocacy priorities, but we will never be guilty of sitting still. I encourage all of you to join us and continue to “run through the tape” with these critical efforts during our lame-duck session.

As always, I welcome your thoughts.

MHA CEO Report — Protecting Access to Care Through 340B

MHA Rounds image of Brian Peters

“I alone cannot change the world, but I can cast a stone across the water to create many ripples.” Mother Teresa

MHA Rounds image of Brian PetersProtecting access to high quality, affordable healthcare for all Michiganders is a key tenet of the MHA. Stated simply, the 340B drug pricing program, created by Congress in 1992, is absolutely crucial to our member hospitals’ ability to maintain this access. And remarkably, since its inception to the current day, it has never required any state or federal taxpayer dollars.

One of my favorite elements of my MHA job is the opportunity to travel around the state and visit with the executives, clinicians and other important employees of our Michigan hospitals. I always ask the question: “What are your highest priorities and how can we help?” One of the most consistent answers for years has been: “We need to protect 340B.” Erosion or elimination of the program would quite literally mean the closure of key service lines, or even the hospital itself, in some cases.

At a time when drug prices are the most rapidly growing expense for hospitals, the 340B program has never been more important. It acts as a force multiplier, allowing hospitals to stretch incredibly scarce resources to provide high quality care for more patients in their communities, including our most vulnerable residents. The savings created from the ability to purchase certain prescription drugs at a discount enables hospitals to keep care in the community in various ways. Examples include funding free or heavily discounted prescription drugs for patients, trauma care, care for people with HIV/AIDs, behavioral health services, oncology clinics, nursing homes and treatment for substance use disorder.

It allows qualifying hospitals, particularly rural hospitals and those serving low-income patients, to deliver care and programming based on the needs of their individual communities. Many larger 340B hospitals are academic medical centers that care for the sickest and most complex patients. They establish arrangements with pharmacies outside of their immediate geographic area so patients who travel long distances to the hospital for specialized care can still access needed drugs at pharmacies near the patient’s home.

Unfortunately, prescription drug manufacturers are working to put arbitrary limits on the 340B program at the state and federal level and Michigan hospitals are at risk of losing their ability to provide affordable, accessible care to those in need. This comes at the same time when costs for new drugs launched by pharmaceutical companies rose by 35% from 2022 to 2023 and for the first time in history, the median price of a new drug is $300,000 – more than four times the median annual household income in the U.S. These attacks will make it more difficult to administer the 340B program and unnecessarily cut needed savings that could be invested in the community. These restrictions threaten access to care by risking the closure of birthing units, nursing homes and even critical access hospitals.

The MHA and Michigan hospitals are currently advocating for the passage of House Bill 5350 to counteract these attacks. The proposed legislation would help protect the 340B drug pricing program at the state level and the healthcare cost-savings generated for hospitals and the communities they serve. We highly encourage you to use our action alert to express the importance of the program to your lawmakers as the bill currently awaits passage out of the House Insurance and Financial Services committee.

Other harmful actions by manufacturers include Johnson & Johnson’s recent attempt to institute an unapproved rebate requirement for two drugs. The MHA opposed that proposal and we’re pleased to see that our advocacy with the Health Resources and Services Administration (HRSA) and our Congressional delegation, along with other hospitals and state hospital associations from across the country, influenced Johnson &  Johnson into discontinuing their pursuit of this unauthorized plan, after multiple HRSA notices of opposition.

This specific work is just the latest example of the MHA’s long-time strident advocacy at the state and federal level related to 340B. We have engaged in the state legislature, Congress, the courts and with our MHA Service Corporation Endorsed Business Partners, demonstrating just how impactful we know this program is.

The 340B program has helped to improve the health and wellness of individuals and communities for 30 years. It operates without any taxpayer-funded support and has positively impacted millions of lives. Attempts at eroding the program would not only harm hospitals, but more importantly patients and communities. As I have often said, the healthcare ecosystem is incredibly complex and there is rarely if ever a single silver bullet solution to any aspect of our challenges. But there is no doubt that the 340B program is one of those critically important stones that creates many positive ripples.

As always, I welcome your thoughts.

Help Protect 340B in Michigan: MHA Action Alert Available

Hospitals throughout Michigan rely on savings from the 340B Prescription Drug Pricing Program every day to spread scarce resources and care for those with limited or no access to healthcare. As manufacturers and other players at the state and federal level work to scale back the program, the MHA team is engaged in efforts to protect 340B and generate public awareness about the benefits it provides to Michigan patients and communities. Those interested in advocating for the 340B program are encouraged to contact House Insurance and Financial Services Committee members in a few quick steps through an MHA Action Alert.Two women hugging in a hospital setting with overlay text that reads, "340B Protects Access to Lifesaving Care" with text below that says learn more at MHA.org

The action alert requests committee members pass House Bill (HB) 5350, introduced by Rep. Alabas Farhat (D-Dearborn), to protect the 340B program and preserve healthcare cost-savings for Michigan hospitals and the communities they serve. The House Insurance and Financial Services Committee convened June 5 to hear testimony on the bill, allowing representatives from Henry Ford Health, Memorial Healthcare, McLaren Healthcare and Trinity Health to speak in support of the legislation.

Additionally, the MHA created a 340B webpage, downloadable infographic, digital ads and informational social media content. Targeted messages have been displayed more than 150,000 times to audiences in the downtown Lansing region.

Elizabeth Kutter, senior director of government and political affairs, MHA, provided first-hand insight on the strong impact of the 340B program in an MHA Rounds article.

“I’ve had countless conversations with our members about the benefits of 340B,” said Kutter. “The sentiment across the board – especially among rural hospitals and urban safety net hospitals – is that the program is essential for meeting patients where they are…every effort spent to manage the new onslaught of administrative burden created by manufacturers, is less savings going directly into communities in need of affordable care.”

The MHA continues to advocate for 340B and uplift the efforts of Michigan hospitals to expand access to quality, community-based care. Members with questions should contact Elizabeth Kutter at the MHA.

Protecting Community-based Care Through 340B

MHA Rounds graphic, indicating thought leadership blog style post. Featuring Elizabeth Kutter pictured, woman with blonde hair smiling on the right.

MHA Rounds graphic, indicating thought leadership blog style post. Featuring Elizabeth Kutter pictured, woman with blonde hair smiling on the right. Byline: Elizabeth Kutter, Senior Director, Government & Political Affairs 

Right now, a low-income patient in Northern Michigan is picking up a drug at a discounted price that they wouldn’t otherwise have access to. In another corner of the state, a cancer patient is receiving lifesaving treatment, without having to make decisions between their care and their family’s needs.

Michigan hospitals care for our communities every day because of the savings they receive from the 340B Prescription Drug Pricing Program. Since being established by Congress in the early 1990s, this cost-saving program helps to spread scarce resources and provides a safety net to vulnerable patients and communities with limited or no access to healthcare.

The impact of 340B goes far beyond drug prices. It helps maintain community-based services at Federally Qualified Health Centers, cancer hospitals, HIV/AIDs clinics, critical access hospitals and tribal health centers among many other organizations. The program savings help eligible entities support mobile health clinics, cancer care access, financial assistance programs, meals on wheels, neonatal intensive care transports, behavioral health access and many other programs informed by the communities that benefit from the eligible program participants being in their backyard. 340B hospitals support community informed opportunities to positively impact public health.

In my role at the MHA, I’ve had countless conversations with our members about the benefits of 340B. The sentiment across the board – especially among rural hospitals and urban safety net hospitals – is that the program is essential for meeting patients where they are. The American Hospital Association shares a similar message, noting that 340B generates valuable savings for eligible hospitals to invest in programs that enhance patient services and access to care. The program’s design speaks directly to the ability for 340B covered entities to reflect on their community needs, it’s not a program that attempts to decide where savings need to go but instead focuses on the individual needs of every community being served resulting in increased quality of care and access to healthcare in all corners of Michigan.

Unfortunately, manufacturers and other players at the state and federal level are working to scale back the program and put arbitrary limits on program participation. The most recent and current attempt being to condition 340B contractual pharmacy relationships, harming the program’s ability to extend to patients in the places they live. Because of these attempts to frustrate the program, Michigan hospitals are at risk of losing their ability to provide affordable, accessible care to those in need. Every effort spent to manage the new onslaught of administrative burden created by manufactures, is less savings going directly into communities in need of affordable care.

Rarely are we presented with the opportunity to support meaningful access to drug cost reductions and affordable community care access, but House Bill 5350 allows us to do just that. The proposed legislation helps protect 340B at the state level to maintain healthcare cost-savings for our hospitals and the communities they serve. Contact your lawmaker and tell them how important 340B is to you, your community, and most importantly the patients you serve. Protecting our ability to care for our state’s most vulnerable patients is of the utmost importance, and HB 5350 does just that.

It’s our job to safeguard resources that advance the health of Michigan communities. I hope you’ll join me – and many others – in advocating for my favorite combination of numbers and letter: 340B.

Members with questions may contact me.