New Study: Michigan Hospitals Marking Up Lower-Cost Alternative Drugs, Charging More than Brand Name Medicine
April 29, 2026 – Patients who are prescribed a lower-cost alternative to an important biologic medication wind up paying significantly more than the higher-cost brand name medicine at more than 3 out of 4 Michigan hospitals and clinics, according to a shocking new analysis from the Michigan Health Purchasers Coalition (MIHPC).
Physicians across Michigan have been prescribing a lower-cost “biosimilar” medicine to save their patients’ money on their health care, but Michigan hospitals have responded to doctors’ good will and cost-saving attempts by secretly charging patients significantly more for the cheaper medicine than if they’d been prescribed the name brand drug.
New Michigan Analysis Shows Local Hospital Profits Skyrocketing: Urban Hospital Groups Average 20%!
Operating Margin Profits Up to 16% in 2024, While Costs to Patients Increased by Almost Twice the Rate of Inflation
March 16, 2026 – Hospital operating margin profits are rising dramatically across Michigan, according to a new analysis published by the nonpartisan Michigan Health Purchasers Coalition. In Michigan, the average operating margin climbed from 12% in 2023 to 16% in 2024, the last year for which full data is available. This record-level growth represents $16 in profit for every $100 in net patient revenue. The surge in profits is led by large, urban hospital groups that enjoyed a 20% operating margin in 2024.
77% of Michigan hospitals had an operating profit margin of 10% or higher in 2024. Hospitals with the highest average operating margins in Michigan between 2019 and 2024 are disproportionately affiliated with large health systems, including University of Michigan / UM Sparrow (22%), Corewell (18%) and Bronson (16%).
“Average operating margins among hospitals in Michigan increased significantly over the last two years,” said Bret Jackson, President of the Michigan Health Purchasers Coalition. “The growth in profitability has been driven by revenue growth, not cost control, raising big challenges for patients and payers who are footing the bill. Consolidation, expansions, and even markup programs like 340B all contribute to a bigger margin for executives, but patients pay the bill.”
Between 2023 and 2024, hospital net patient revenue increased 14% while operating expenses grew by only 6%. Overall, Michigan hospital revenue grew by $5.05 billion year-over-year, far exceeding the $1.92 billion increase in expenses.
According to previously published data, the cost of hospital services has also increased dramatically faster than other services, including the cost of college tuition, childcare, housing, and inflation. The cost of hospital services has increased more than 281% since 2000, almost double the rate of inflation and 131.1% the rate of wage growth.
In Michigan, 47 cents on the dollar of commercial health plan premiums is spent on hospital services. For employers that means higher annual premium increases, reduced ability to invest in wages and workforce growth, increased cost shifting to employees, and difficulty recruiting and retaining talent.
For employers and health care purchasers, market consolidation has reduced competition among providers. When large systems dominate regional markets, over time they contribute to higher healthcare costs for employers, employees, and health plans.
“Big hospital groups’ big operating margins create real workforce and economic challenges affecting Michigan employers, families, and public budgets,” said Jackson. “They mean higher health insurance premiums, higher out-of-pocket costs for working families, and higher cost-of-living.”
CLICK HERE to read the study.
Study: Significant Drug Price Differences in Women’s Health Medications When Prescribed at Hospitals
September 23, 2025 – Women in Michigan can experience a variance of up to $30,000 for the same medication, depending on which hospital the medication is prescribed, according to two research reports released by the Michigan Health Purchasers Coalition (MIHPC). The reports highlight pricing variances and discrepancies when it comes to women’s health medications, specifically denosumab and ocrelizumab. MIHPC has used the average sales price (ASP), the volume-weighted average of manufacturer sales prices for a drug across all purchasers, and the net of all price concessions (rebates, discounts, etc.) as the baseline for these findings. ASP is used as a guideline for how much health systems should pay for a specific medication.
“These reports underscore the wide gap in hospital pricing across the state,” said Bret Jackson, President of MIHPC. “Referencing the ASP as a benchmark reveals the extent to which hospitals are inflating prices for everyday drugs, further demonstrating the need for urgent action on improved transparency and accountability throughout hospitals across Michigan.”
MIHPC’s aim is to highlight these pricing disparities and increase awareness about the importance of drug pricing transparency in healthcare. READ MORE
Study: Hospital Profits Dramatically Increase Amid Rising Healthcare Costs in Michigan
June 24, 2025 – While Michigan residents are paying increasingly more for healthcare services, major hospital systems are raking in dramatically higher profits, according to a hospital operating profit margins and commercial prices study released by the Michigan Health Purchasers Coalition (MIHPC).
With data provided through their required Medicare cost reports, Michigan’s major hospital systems – Corewell Health, Henry Ford Health, McLaren Health, and Trinity Health – are among 68 percent of the Michigan hospitals that are reporting a six-year average operating profit margin of at least 10 percent. This means the hospital nets $10 for every $100 spent on patient care.
In comparison, the report shows 15 percent of Michigan hospitals with a “moderate” operating margin between four to nine percent and another 17 percent have a “lower” operating margin of below four percent. Many of those reporting with a lower operating margin are typically small hospitals located in rural communities. READ MORE
Michigan Health Purchasers Coalition Reveals Significant Drug Price Differences Among Hospitals in Similar Geographic Areas
May 20, 2025 – The Michigan Health Purchasers Coalition (MIHPC) has released three research reports highlighting perceived disparities in pricing for drugs commonly prescribed to patients as injections or infusions in hospital settings. MIHPCs findings emphasize the great need for pricing transparency.
MIHPC has used the average sales price (ASP), the volume-weighted average of manufacturer sales prices for a drug across all purchasers, and the net of all price concessions (rebates, discounts, etc.) as the baseline for these findings. ASP is used as a guideline for how much health systems should pay for a specific medication.
“These reports highlight a huge disparity in hospital pricing across the state,” said Bret Jackson, President of MIHPC. “By using the ASP as a benchmark, we clearly display how much hospitals are price gouging Michiganders when it comes to common drugs and the need for urgent action on transparency and accountability from the hospitals.”
MIHPC’s aim is to highlight these pricing disparities and increase awareness about the importance of drug pricing transparency in healthcare. READ MORE
Studies Reveal Shocking Price Differences for Common Procedures at Local Hospitals Across Michigan
MIHPC Encourages the Public to Shop Around for Healthcare
April 29, 2025 – The Michigan Health Purchasers Coalition (MIHPC) has completed a series of studies examining the significant price gaps across hospitals for various healthcare procedures. These findings aim to inform individuals, families, and employers about pricing disparities, helping them make more cost-effective healthcare decisions.
“It is so important to do your research prior to receiving any medical treatment – anything from a hip or knee replacement, a brain scan, an endoscopy, or childbirth,” said Bret Jackson, President of MIHPC. “Patients who invest their time in finding the most cost-effective procedures, can receive quality services while saving themselves hundreds – if not thousands – of dollars. Just like one would when shopping for a car, consumers should explore their options when it comes to healthcare procedures.” The studies outlined below reveal significant variations in the cost of these procedures across hospitals statewide in Michigan. READ MORE
April 16, 2025: The Michigan Health Purchasers Coalition (MIHPC) has released a new research report examining the rising costs of employer-sponsored healthcare in Michigan. Over four million Michigan citizens are covered by employer-sponsored plans and rising healthcare costs have placed considerable stress on working families and employers.
On average, 9% of Michigan adults or 690,000 people, report having medical debt in a given year, and over 60% of individuals report being worried about their ability to afford unexpected medical bills. Included in the report is data from Altarum’s Consumer Healthcare Experience, reporting that 51% of Michigan adults had skipped or postponed health care—including needed dental care, recommended medical tests or treatments, filling prescriptions, having a procedure, and accessing mental healthcare or treatment—because of the cost. These high prices lead Michiganders to delay or avoid receiving the care they need altogether, which poses clear risks to public health. READ MORE
October 25, 2024: Survey Suggests Michiganders Lack Trust in the Healthcare System and Want Increased Price Transparency
Majority of respondents agreed the state’s healthcare system needs to change
According to a new survey conducted by the Michigan Health Purchasers Coalition (MIHPC) throughout September 2024, politicians may want to put healthcare costs as a priority. An overwhelming 91 percent of survey respondents agreed that elected state officials need to take action to reduce healthcare costs. MIHPC asked 600 Michigan residents their opinion regarding the state’s healthcare system. The results demonstrated the public’s lack of trust in the healthcare system and the need for price transparency. READ MORE. Refer to the infographic for quick reference.
May 16, 2024: The Michigan Health Purchasers Coalition (MIHPC), tasked with the mission of lowering healthcare costs for employers and families in the State of Michigan, released a study raising an alarm regarding the fast pace of rising costs for hospital services in the State of Michigan. The report demonstrates how the increase in hospital cots have a negative impact on the economy. It also highlights how hospital acquisitions and mergers also contribute to the acceleration of healthcare costs.
Between 2010 and 2020, payers of healthcare in Michigan experienced a 40 percent increase in costs for hospital services. Average single and family health insurance premiums in the state have increased by 38% and 31% respectively from 2013 to 2022.
Hospital prices account for almost half the bill of employer healthcare costs. With less monies for wages, technical advancement, job creation and increased productivity, Michigan and the rest of the country have reduced competitiveness in the global market. READ MORE