Michigan hospitals tell House committee staffing shortages, drug prices and supply costs are driving health‑care prices

At a House Insurance Committee hearing, Michigan Health & Hospital Association leaders told lawmakers that workforce shortages, higher drug prices and rising supply costs are the primary drivers of hospital expenses and threaten access to services in parts of the state.

"Michigan hospitals are more than health care providers. We're cornerstones in the community," said Elizabeth Cutter, senior director of government and political affairs for the Michigan Health & Hospital Association (MHA), during the presentation. She and Laura Pell, MHA executive vice president for government relations and public policy, described workforce, drug pricing and supply disruptions as the main cost pressures facing hospitals.

The association told committee members that Michigan hospitals employ more than 220,000 people and delivered roughly $10.4 billion in tax revenue last year, and that its members reported about 23,000 job vacancies as of early 2025. Cutter said labor costs make up approximately 56% of a hospital's total expenses and that nursing remains the largest single category of vacancies.

The MHA also highlighted national drug‑price trends and local examples. Cutter said median prices of new drugs entering the market in 2023 topped about $300,000 and cited data showing established drug price increases well above inflation. Pell described episodes of severe shortages that raised…