2023 House Bill 4276 / Public Act 279

House Fiscal Agency Analysis

House Bill 4276 would require that, if the Department of Health and Human Services (DHHS) enters into a contract with a Medicaid managed care organization that relies on a pharmacy benefit manager, the pharmacy benefit manager must do all of the following: • For Michigan pharmacies with seven or fewer retail outlets, use a pharmacy reimbursement methodology of the lesser of national average drug acquisition cost plus a professional dispensing fee that is at least equal to to the applicable professional dispensing fee provided through section 1620 of Article 6 of 2020 PA 166 (see Background, below), wholesale acquisition cost plus a professional dispensing fee provided through that section, or the usual and customary charge by the pharmacy. The pharmacy benefit manager or the involved pharmacy services administrative organization could not receive any portion of the professional dispensing fee. DHHS would have to identify the pharmacies this provision applies to and provide the list of applicable pharmacies to the Michigan Medicaid managed care organizations. • Reimburse for a legally valid claim at a rate that is not less than the rate in effect at the time the original claim adjudication was submitted at the point of sale. • Agree to move to a transparent pass-through pricing model, in which the pharmacy benefit manager discloses the administrative fee as a percentage of the professional dispensing costs to DHHS. • Agree to not create new pharmacy administration fees and to not increase current fees more than the rate of inflation. This provision would not apply to any federal rule or action that creates a new fee. • Agree to not terminate an existing contract with a Michigan pharmacy with seven or fewer retail outlets for the sole reason of the additional professional dispensing fee authorized under the bill.