Legislative Analysis
Phone: (517) 373-8080
REQUIRE HEALTH INSURANCE COVERAGE OF PREP
http://www.house.mi.gov/hfa
House Bill 5340 as introduced Analysis available at
Sponsor: Rep. Mike McFall http://www.legislature.mi.gov
Committee: Insurance and Financial Services
Complete to 12-4-24
SUMMARY:
House Bill 5340 would amend the Insurance Code to require that any insurer that delivers,
issues for delivery, or renews a health insurance policy in Michigan that provides coverage for
prescription drugs to provide coverage, without cost sharing, for products approved by the
U.S. Food and Drug Administration (FDA) for pre-exposure prophylaxis (PREP) with effective
antiretroviral therapy for the reduction of risk of HIV infection, including any clinical services
necessary for the individual to receive the prescription, such as an HIV test, a physician office
visit, or counseling by a pharmacist. An insurer could not exclude or limit coverage for PREP
when dispensed or administered by pharmacy personnel.
Cost sharing would mean an enrollee's individual financial responsibility associated
with receiving specific services, including copayments, coinsurance, and the
application of a deductible. It would not include the payment of a premium.
Pharmacy personnel would mean a pharmacist and, when acting under pharmacist
supervision in accordance with applicable law, a pharmacy intern or technician.
An insurer could not limit the subject PREP to prior authorization or step therapy unless the
FDA has approved one or more therapeutic equivalents of a drug, device, or product for the
prevention of HIV.
The bill would not require an insurer to do either of the following:
• Add coverage for PREP or related services furnished by an out-of-network provider.
• Cover all of the therapeutically equivalent versions without prior authorization or step
therapy, as long as at least one therapeutically equivalent version is covered without
prior authorization or step therapy.
Proposed MCL 500.3406dd
FISCAL IMPACT:
House Bill 5340 would not have a direct fiscal impact on any units of state or local government.
However, Section 150 of the Insurance Code provides for recourse and penalties in the event
of a violation of the code. Under the provisions of that section, violators have the opportunity
for an administrative hearing before the DIFS director, who may levy a civil fine of $1,000 for
each violation, or $5,000 if the individual knew or reasonably should have known that they
were violating the Insurance Code. Civil fine payments under the Insurance Code are capped
at $50,000, and any revenue collected must be deposited to the state's general fund. To the
House Fiscal Agency Page 1 of 2
 extent that violations of new provisions within the bill occur, additional general fund revenue
may indirectly be realized and enforcement costs incurred.
Legislative Analyst: Alex Stegbauer
Fiscal Analyst: Una Jakupovic
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency HB 5340 as introduced Page 2 of 2


Statutes affected:
House Introduced Bill: 500.100, 500.8302