Exposing 340B Abuse: How Michigan Hospitals Are Failing Families
340B hospitals mark up prescription drug prices and pocket the revenue. To see if patients benefit, Community Action for Responsible Hospitals analyzed public data on Michigan hospitals’ revenue growth, financial investments, charity care, and workforce pay.​
Big Hospitals Put Profits First.​
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​Michigan hospitals provide far less charity care than the rest of the nation. At the same time, hospital executives are enriching themselves:
One Detroit system’s CEO collected over $4 million in reportable pay plus approximately $2 million in “other compensation” in 2023.
Another Michigan hospital CEO pockets over $10 million per year, making him one of the nation’s highest-paid hospital executives.
The 340B program has fueled massive hospital consolidation in Michigan. One Detroit system swallowed eight more hospitals, creating a $12 billion mega-system that threatens patient choice and drives costs higher.
Meanwhile, a dominant health system has built a 340B network centered on PBM-owned pharmacies, while also running its own health insurer – blurring the line between payer and provider.
Studies show Michigan hospitals inflating drug prices by 800% or more compared to what hospitals actually pay manufacturers. And it gets worse – many patients end up paying 10-20 times their original cost due to hospital markups.
A $1,738 arthritis treatment was marked up 900% to $13,514 at a Mount Clemens hospital. At a Detroit hospital, the same drug was marked up 1000% to $15,808.
Massive Markups. But Hospitals Say They Need Even More.
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​Michigan hospitals aren’t just consolidating power, they’re also charging outrageous markups on medicines.
When Hospitals Play Monopoly, Patients Pay the Price.​​
​​​These hospital markups drive medical bills into the stratosphere while executives claim they need even more revenue.
Michigan’s 340B program was meant to serve patients, not pad hospital profits. Instead, charity care lags far below national averages, and drug markups soar at the expense of patients.
HOLD 340B HOSPITALS AND CLINICS ACCOUNTABLE - VOTE NO ON SB 94/HB 4878!