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Michigan's working to cut prices for medicaid recipients

EDWARDSBURG, Mich – Michigan is becoming the second state to negotiate directly with drug companies in an effort to lower Medicaid drug costs.

Michigan is second only to Oklahoma to create a program that aims to lower costs by tying patient outcomes to prices.

“I think it’s a wonderful idea simply because the cost of drugs continues to be a problem in delivering care to patients, patients often times can’t afford their medications,” Michiana area Physician, Dr. Maureen Ziboh said. 

In announcing the program, the state of Michigan stated the state will “Experience more affordable prescription based treatment for Medicaid beneficiaries.” 

The states newly approved plan will also incentivize drug manufacturers to provide more effective medications and tie reimbursements to the drugs actually working. 

“So we basically agree with the drug companies on pre-determined outcomes that the drugs need to make and if they’re unable to meet those requirements then there are rebates that the drug company is responsible for paying,” Michigan Health and Human services Public Information Officer Bob Wheaton said. 

Currently the state of Michigan picks up the extra costs paying the rebates, the new program will switch the burden to the drug companies and Wheaton believes the penalty will help force changes. 

“This is a good incentive for the drug companies to provide effective medication that meet the needs of Medicaid patients and it’s a way of making the costs of these drugs more cost effective,” Wheaton said.  

Local Doctor, Dr. Maureen Ziboh says the program seems like it will help both Doctors and Medicaid recipients.

“I don’t really see any negatives because I think the patients will have more access to medication and it would take the bottleneck away from the offices from what we have to do every day to make sure patients are able to afford their medication,” Dr. Ziboh said 

The state of Michigan still has to negotiate with the pharmaceutical companies and assess in the future if the program saves money from the current approximately $17-billion Medicaid budget. 

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