This bill amends the Social Welfare Act by introducing new requirements for Medicaid managed care organizations regarding their contracts with pharmacy benefit managers. Specifically, it mandates that these organizations utilize a pharmacy reimbursement methodology that ensures fair compensation for Michigan pharmacies with seven or fewer retail outlets. The reimbursement must be based on the lesser of the national average drug acquisition cost plus a professional dispensing fee, wholesale acquisition cost plus a professional dispensing fee, or the pharmacy's usual and customary charge. Additionally, the bill outlines specific methodologies for reimbursing brand and generic drugs when national average drug acquisition cost prices are unavailable, ensuring that pharmacies are compensated fairly.

The bill also includes provisions that prohibit pharmacy benefit managers from receiving any portion of the professional dispensing fee and requires transparency in pricing models. It stipulates that Medicaid managed care organizations cannot terminate contracts with Michigan pharmacies solely due to the additional professional dispensing fee authorized by this section. Furthermore, the bill allows for the implementation of these provisions before the effective date of February 13, 2024.

Statutes affected:
House Introduced Bill: 400.105