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Michigan Legislative Update—February/March 2009


Email Alert

By Jessica Swartz*

April 1, 2009

On March 24, 2009, Rick Murdock, the Executive Director of the Michigan Association of Health Plans (MAHP), testified before the Michigan House health policy committee regarding the potential for creating low cost (around $200 a month) individual health policies.1 Mark Cook, Vice President of Governmental Affairs for Blue Cross and Blue Shield of Michigan (BCBSMI), also participated in the hearing. The testimony was focused on reform of the individual health insurance market in Michigan and its growth due to the fact that many small and mid-sized businesses are eliminating group health plans. Mr. Murdock suggested that to help provide cheaper individual health policies to the average consumer, MAHP would be in favor of legislation allowing carriers to consider certain pre-existing medical conditions when initially pricing individual insurance products. He stated, "We are not seeing that in Michigan . . . . We would be comfortable with having that [provision] in the legislation."

On February 4, 2009, State Congresswoman Alma Wheeler Smith introduced HB 4160 that would create a Midwest Pharmaceutical Compact (Compact).2 Illinois, Indiana, Kansas, Minnesota, Michigan, Missouri, Nebraska, North Dakota, Ohio, Wisconsin, and Ontario, Canada, are initially eligible to become party to the Compact. Additional states could be admitted if approved by a majority of the compacting states.

If enacted, the Compact would:

[P]rovide an enlarged pool for the purchase of pharmaceutical products and services for all Medicaid recipients, publicly insured or uninsured health care recipients, and any other persons who the commission deems eligible who reside in the compacting states that are party to this compact.3

The Compact would be enabled to negotiate prices and purchase products directly from the pharmaceutical companies as well as "establish an open formulary for all of the compacting states or . . . designate which, if any, pharmaceuticals [would] be preauthorized for use within the [C]ompact."4 The bill provides that the Compact would not become effective unless enacted by three states prior to December 31, 2010. This bill was introduced previously in 2007 (HB 4094) and 2003 (HB 4289), but did not survive committee review.

In February and March 2009, several bills which would require insurance companies to cover therapy for autistic individuals were introduced.5 Similar legislation was previously introduced, but was not enacted.6 BCBSMI opposes the legislation stating, "It's a mandate that prevents purchasers from having flexibility in choices in the benefits they provide."7 A Michigan resident is currently suing BCBSMI to provide such coverage and is seeking class action status in the U.S. District Court.

Bills proposing sales tax exemptions for nonprescription medications and to regulate incentives that physicians or healthcare providers receive from carriers for prescribing certain medications were also introduced this month and have been referred to committee.8

1 Jay Green, Head of Health Plans Group Endorses Creating Low-cost Individual Policies, DETROIT NEWS, March 24, 2009; see also Nancy Schlichting, Ensure Michigan's Stimulus Health Care Aid is Spent on Coverage, DETROIT NEWS, March 24, 2009 (advocating use of Michigan's federal stimulus money in the state Medicaid programs).
2 See
3 HB 4160, Art. I.
4 HB 4160, Art. V, 2.
5 SB 0359, SB 0360, HB 4183, HB 4476 at
6 SB 0785 (2007), HB 5527 (2007), HB 5529 (2007) at
7 Jennifer Chambers, Michigan Mulls Over Autism Insurance Coverage, DETROIT NEWS, March 23, 2009.
8 HB 4366, SB 0356.

*AHLA wishes to thank Jessica Swartz, Esquire (U.S. Department of Veterans Affairs, Washington, DC) for writing this email alert.

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