BCBSM vs. MHA & MichBio

Here is Brian Peter's response:

https://www.freep.com/story/opinion/contributors/2025/10/21/rising-health-care-costs-michigan-hospitals-association/86804188007/

Hospital association head: 'Finger-pointing' won't fix rising health care costs | Opinion
By Brian Peters, Op-ed contributor - October 21, 2025

Finger-pointing makes headlines, but it won’t fix Michigan’s health care challenges. Rising costs are real for families and employers — and for hospitals, too. What’s not real is the claim that hospitals are driving those costs with unnecessary or ineffective care. That narrative misunderstands the complexities pushing spending higher, and risks harming patients by undermining the very providers keeping emergency rooms, trauma centers and maternity units open.

Let’s start with what hospitals can’t control.

Drug spending surged in 2024, driven by several high-cost medicines in oncology, diabetes and autoimmune disease, the PwC Health Research Institute found. At the same time, labor — the people who staff intensive care units, operating rooms and emergency departments around the clock — is the single largest expense for hospitals, accounting for more than half of total costs as wages rose to retain nurses and other critical staff during an unprecedented workforce shortage, according to the American Hospital Association.

On top of that, inflation, supply chain disruptions and tariffs continue to push up the price of routine medical supplies, from surgical gowns to IV tubing.

Reimbursements don't cover the cost of care

Hospitals also treat everyone seeking emergency care. In line with our mission and federal law, we care for everyone who comes through our doors, 24/7, regardless of their ability to pay. When a patient arrives with a stroke at 3 a.m. or a child needs trauma care after a car crash, no hospital in Michigan asks for a credit card before providing care. That’s a promise we will always keep.

Meanwhile, public reimbursements routinely fail to cover the cost of that care. In the most recent national data, Medicare paid just about 83 cents for every dollar it costs hospitals to care for a Medicare patient, contributing to more than $130 billion in annual underpayments when Medicare and Medicaid are combined, per the American Hospital Association. Hospitals also deliver tens of billions of dollars in essential but uncompensated care each year to patients with no ability to pay, the association found.

Michigan’s picture mirrors these national pressures. Hospitals across our state continue to absorb more than $1 billion in uncompensated and under-reimbursed care collectively. Rural and northern communities feel these pressures most acutely, where keeping obstetrics or inpatient psychiatric services open can hinge on razor-thin margins, the Michigan Health & Hospital Association, the group I lead, found.

Follow the money

Margins tell the real story.

Michigan was one of only four states in the country where hospitals had, on average, a negative margin, according to the Kaiser Family Foundation. In rural America, closures and conversions have accelerated since 2010, and nearly half of rural hospitals nationally are now in the red, and hundreds vulnerable to closure.

In Michigan, more than half of rural hospitals are operating at negative margins, the Chartis Center for Rural Health reported. These are not signs of a system profiteering off patients. These are signals of a system under financial stress.

And when hospitals are financially destabilized, patients pay the price, not through higher prices but through lost access. When a mother in the U.P. must drive over an hour to deliver a baby, that’s not a finance story. It’s a public safety crisis.

If you want to know who is profiteering off health care, follow the money.

Independent analyses show drug manufacturers’ margins far exceed those of hospitals, with drug company profitability running two to three times higher than hospital margins in many comparisons, according to the Journal of the American Medical Association (JAMA). A 2024 review of sector margins likewise found that PhRMA’s average net income margins dwarf those of other drug-supply-chain players, the Campaign for Sustainable Rx Pricing found.

Hospitals are the backbone of care

Hospitals are doing our part.

Across Michigan, hospitals are moving care to more affordable settings, using lower-cost medication alternatives when appropriate, improving care coordination and expanding the behavioral health workforce.

But no health system can sustain 24/7 readiness — trauma, neonatal intensive care, emergency psychiatry — if reimbursement chronically fails to meet the actual cost of care and costs for labor, supplies and drugs continue to rise.Let’s be honest with patients and employers: Hospitals are not the villains of affordability.

We’re the backbone of access: the nurse at the bedside at 3 a.m., the surgical team on call, the therapist helping a child walk again. Michigan hospital teams will keep showing up with compassion and professionalism.

What we ask in return is an honest conversation grounded in facts, not talking points, because protecting access to care in every Michigan community is a responsibility we all share.

Brian Peters is CEO of the Michigan Health & Hospital Association.  It should be noted that Republican House Speaker Matt Hall has called for his ouster, repeatedly, after President Peters and his group criticized the nearly $79 billion Michigan FY 26 budget.  President Peters is quite enthusiastic about health care spending.

Stephen Rapundalo, the President and CEO of Ann Arbor-based MichBio, the Michigan Biosciences Industry Association, wants in on the debate:

https://www.freep.com/story/opinion/readers/2025/10/23/bcbsm-pharma-drug-insurance-rising-health-care-costs/86806396007/

BCBSM CEO blamed drug industry for rising health care costs. She got it wrong. | Letter
By Stephen Rapundalo - October 23, 2025

In a recent ep-ed, Blue Cross and Blue Shield of Michigan CEO Tricia Keith laid out a number of cost drivers in the health care system.

Unfortunately, she didn’t take any responsibility for the role that Blue Cross plays in the increased costs to patients. Instead, she assigned blame to other players in the system, without proposing what health insurers could actually do to help reduce costs.

BCBSM CEO pens op-ed: Health care costs are rising. We need to reform the system.
I lead the Michigan Biosciences Industry Association, or MichBio, an association of research and manufacturer companies that develop life-improving and life-saving medicines for patients in need.

Michigan has been on the leading edge of some of the most blockbuster drugs that continue to help people live better and longer lives.

Just two examples include Lipitor, the best-selling cholesterol-lowering drug in history, which was developed in Ann Arbor at Parke-Davis Pharmaceuticals, and AZT, the first approved treatment for HIV/AIDS, discovered at Wayne State University, giving hope to millions across the globe.

The fact is, medical science has never been more promising, and despite all the groundbreaking innovation in medicine, spending on medicines remains a small and stable 14% of total health spending.

I was especially surprised that Keith didn’t mention the role that Pharmacy Benefit Managers (PBMs) play in inflating the costs of prescriptions for patients. They’re the middlemen that set the actual price of medications. Pharmaceutical companies sell their products at much lower costs, but PBMs mark up the price and make billions in profits as a result. Some PBMs are owned by the actual pharmacies, so they’re making huge profits off every step in the health care process.

Instead, Keith proposed eliminating the ability of pharmaceutical companies to advertise their products. The result would be a less informed patient, and lead to insurance company bean counters telling your doctor what they can and cannot prescribe. This would not make health care better; it would make bigger profits for health insurers.

If Keith wants to go down the advertising route, Blue Cross should consider reducing its advertising and sponsorship budget. You can’t attend a sporting event without seeing their logo plastered all over the stadium.

What if they, instead, reduced their costs to patients with those funds? Maybe they wouldn’t have to charge double-digit premium increases every year.

Keith also complains about patent protection for companies that have made major discoveries. Can you imagine investing billions into research and development to come up with a life-saving medicine, you file for a patent and are told it’s only valid for seven years?

In fact, 90% of prescriptions in the U.S. are filled with lower-cost generics and biosimilars.

As a company, you have to cover your investment costs within that timeframe, and then generics manufacturers are allowed to make and sell your product. Seven years is a very short timeline, but without even that minimal protection, who would do the research and testing that’s necessary?

The bottom line is that everyone in the health care ecosystem has a role to play in reducing costs for patients.

So instead of pointing fingers, how about if everyone sits down and figures out what is best for patients?

That may be the optimist in me hoping for that kind of result, but it’s the only way we’re going to do what’s right by the patients that the system is supposed to help.

The Hill brings the bigger picture of public perspective. 

Chronic finger-pointing can be entertaining, but have you noticed that for industry it's all about managing people's lives?

What gets really interesting is personal responsibility, medical debt, and individual freedom. 

https://thehill.com/policy/healthcare/5572504-healthcare-affordability-voter-poll/

Many voters say health care unaffordable, are open to new insurance system: Poll

Joseph Choi    |    10/27/25

New polling has found that the majority of voters say health care in the U.S. is unaffordable and are open to a health insurance system that doesn’t tie coverage to employment.

Undue Medical Debt, a nonprofit that works to eliminate medical debt and supports policies to prevent new debt, sponsored the poll, which was led by the nonpartisan research firm PerryUndem. Along with a national survey, focus groups were also asked for their opinions on health care.

The poll was provided first to The Hill.

The survey found that 69 percent of voters believe that health care is not affordable today, with that figure remaining relatively consistent across parties.

Thirty-five percent of participants said they currently owed money or have debt due to medical or dental expenses. The same percentage said they had skipped or delayed medical care in the last year due to fears of medical debt.

Survey participants were asked whether they made at least one of eight material sacrifices in the past year in order to meet their financial goals. These included eating less food, skipping vacations, putting more of their expenses on credit cards, falling behind on bills and borrowing money from friends and family.

Among those surveyed, 68 percent said they had engaged in at least one of those practices, with 43 percent saying they’d eaten less or bought less expensive, less healthy foods.

One participant, a 43-year-old uninsured white woman in West Virginia, said in the survey, “I go to a food pantry and I work three jobs. You know what I mean? It’s hard, and it shouldn’t be that hard. I don’t have time to spend with my kids. I don’t have time to do things, because I have to work to eat, you know, and that’s what makes it hard for me.”

“This is a common ground issue that you know is resonating with people. Health care is clearly unaffordable,” Allison Sesso, president and CEO of Undue Medical Debt, told The Hill.

“What I thought was really interesting is really the focus on insurance,” Sesso added. “Seventy-four percent saying that insurance is failing to protect them from medical debt. And I think that that, to me, is a little bit new. Not that it’s new that insurance isn’t working that great, but that such a large percentage of voters on both sides of the aisle were pointing that out as one of the biggest failures.”

Sixty-three percent of participants said they blamed insurance companies the most for medical debt, which was very distantly followed by pharmaceutical companies at 12 percent and hospitals at 9 percent.

Seventy-six percent of voters said they agreed with the statement: “We need to switch to a different system of health insurance where people can change jobs or become self-employed and not have to worry about losing their health insurance.”

“They want to see a system that doesn’t tie them so tightly to their jobs, because it prevents them from moving around,” Sesso said. “And, you know, if you’re not sick, you’re sort of punished to stay at the job, and you don’t have the ability to be sort of self-employed, that you have to sort of hold on to that job for the insurance aspect of it

When it came to addressing medical debt, 76 percent said they wanted their states to pass laws shielding them from medical debt. Measures that received significant support included limiting the interest rate allowed on medical debt, limiting the ability of collection agencies to take a person’s belongings due to medical debt and requiring hospitals to use the same user-friendly application for financial assistance.

Eighty-one percent said they supported the creation of a state-funded health plan that would give residents a more affordable option than commercial plans.

Seventy-seven percent of voters said they would feel more positive about state elected officials if they passed laws with these measures and 75 percent said they would be more likely to vote for someone if they passed these laws.

The ongoing discourse over health insurance and ensuring people can afford it is what is currently keeping the federal government shut down. The current shutdown is already the second-longest in U.S. history, and Democrats are refusing to budge unless a deal is struck to extend enhanced premium tax credits for Affordable Care Act Marketplace plans.

“I’m not surprised that health care is at the center of this conversation. Medical debt and healthcare affordability are, you know, among the few issues where Americans actually agree at this moment,” Sesso said. “I think they’re not holding their breath for Washington to act and to protect them necessarily from medical debt, which is why I think they’re, you know, looking for states to take action.”

For the survey, 1,319 voters in the 2024 general election were included in a 12-minute national survey. The survey was conducted from Aug. 21 to Sept. 2. The results have a margin of error of 3.63 percentage points.