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 Article of Interest - Michigan Courts

State Pharmaceutical Plan Wins in Federal Court
Gongwer News Service, March 28, 2003
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Michigan's controversial pharmaceutical plan requiring physicians to use a state approved list of drugs won a critically important ruling in federal court in Washington, D.C.

U.S. District Court Judge John Bates rejected arguments by pharmaceutical manufacturers and mental health advocates that Michigan improperly instituted the formulary program without first getting approval of the U.S. Department of Health and Human Services.

"This is a victory for the state of Michigan and for all Medicaid beneficiaries," Governor Jennifer Granholm said in a press release. "We had confidence that our program complied with state and federal law, and this ruling will allow us to continue to provide high-quality pharmaceuticals to persons in need while being prudent purchasers of healthcare."

The controversial program was begun last year as a way to save money on Medicaid. State officials say that under the program Michigan saves as much as $850,000 a week. Michigan spends more than $1 billion in Medicaid pharmaceutical costs.

But opponents charged that the program limited the ability of physicians to prescribe the best drugs for their patients. State officials replied that exceptions when medically necessary were permitted; they simply had to be reviewed.

This is the second major legal victory for the state on the program. The Michigan Court of Appeals ruled in its favor last year.

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