Episode 331- Your Deductible Is High And Here Is Why. With Dominick Pallone

Premiums are climbing, deductibles feel heavier every year, and most people still can’t tell you why health care costs what it costs. From the Mackinac Policy Conference, we talk with Dominick Pallone, CEO of the Michigan Association of Health Plans, to get a clear look at what health plans actually do in Michigan and how state policy decisions ripple straight into employer coverage and family budgets.

We start with the basics: MAHP represents nine health insurance companies covering nearly four million Michiganders, and their day-to-day work is advocacy with state lawmakers and regulators. From there, we dig into competition and choice in a market long shaped by a dominant carrier, and why employers and individuals should know they have other network options. The goal, Dom argues, is competing on access, quality outcomes, and real value rather than just headlines.

Then we get to the affordability problem everyone feels. Dom explains why insurers often function as pass-through entities for underlying prices, and why pharmacy costs have become the biggest lever right now. We talk about double-digit premium trends, specialty drugs that are clinically remarkable but financially punishing, and the policy tightrope between supporting innovation and keeping coverage usable. We also explore practical fixes: value-based care arrangements, custom high-value networks, and health literacy tools like real-person call centers and apps that help members compare cost and quality for elective care.

If you care about Michigan health care, health insurance affordability, pharmacy pricing, and what can actually move the needle, this conversation is for you. Subscribe, share this with a friend or colleague, and leave a review with the biggest cost question you want answered next.

Transcript

This episode of the Common Bridge is part of a special 21-part series of interviews recorded with healthcare leaders from across Michigan during the 2026 Mackinac Policy Conference, in partnership with the Michigan Health and Hospital Association. In these short conversations with his guests, Rich explores regulation, cost pressures, workforce challenges, and the future of healthcare in Michigan and around the country.

Richard Helppie

We're back at the Mackinac Policy Conference on behalf of the Michigan Health and Hospital Association. I'm your host, Rich Helppie, from the Common Bridge Podcast and Substack page. We're talking with Dom Pallone — he's the chief executive of the Michigan Association of Health Plans — and we're going to talk today a little about affordability and just who the Michigan Association of Health Plans is. Dom, welcome.

Dominick Pallone

Thank you, thank you for having me, Rich. I appreciate the opportunity.

Richard Helppie

Tell us about the Michigan Association of Health Plans.

Dominick Pallone

We're a state trade association located in Lansing, Michigan, and we represent nine health insurance companies — all the major names you've heard of around the state, as well as local names. My board chair happens to be from the Upper Peninsula Health Plan, and we also have members like Aetna, Molina, Centene, and others. Our work in Lansing is to be their voice and advocacy arm, working with state lawmakers and regulators on all regulatory and policy issues at the state level around healthcare and insurance coverage for our members across the state. Collectively, our members cover close to 4 million Michiganders.

Richard Helppie

Is that right? I'm very impressed with that number — this state has been dominated by one player for some time, going back to our UAW roots, I suppose. What are some of the challenges you have with your group?

Dominick Pallone

Well, that one dominant carrier isn't part of our group, so a big point of emphasis for our members is competition and choice, especially within the commercial marketplace. A lot of our activities involve letting healthcare purchasers — most often employers, whether large group, small group, or sometimes individual families — know that there are other options and other networks available. In an ideal world, we want to be competing over quality and outcomes, making sure we're providing the best health outcomes and best access to care, partnering with hospitals and other provider groups throughout the state to do that, and really showing the people of Michigan that they have choices in who provides their healthcare coverage and access to quality care in our state.

Richard Helppie

Well, I'm glad you mentioned access and quality, and of course the other leg of that is hovering above us, and that's cost and affordability. How are you and your members doing in terms of addressing the affordability issue?

Dominick Pallone

We're very focused right now on affordability — it's certainly the buzzword of the year so far, not just in other areas of our daily lives, but in the healthcare space specifically. Insurers are often pass-through entities for that cost, but we're trying to partner as best we can with provider organizations throughout the state. Our membership prides itself on wanting to work with hospitals of every size and with provider organizations throughout the state to find the best value for our purchasers. Oftentimes, that means working through value-based payment arrangements with those providers. We see a lot of our members doing more in that space today than ever before, and they're excited to do even more. One of the biggest challenges we continue to see, though, is pharmacy costs and the impact that has on overall affordability and, downstream, on insurance premiums. We've seen insurance premiums go up by double digits in our state — it doesn't matter what market you're in, we see that as a scary trend, and we want to course-correct. We think pharmacy is really the biggest lever we need to work on: greater state regulatory efforts to rein in the pharmacy spend behind the cost of some of these drugs, which are truly groundbreaking, remarkable treatments. We don't want to discourage investment in the U.S., and certainly not in Michigan, in drug manufacturing, but we can only afford so much. Unfortunately, we're seeing drug affordability issues drive insurance affordability issues right now in our state.

Richard Helppie

I can imagine that in some of the populations you serve, that's particularly acute. Trying to explain healthcare financing to someone not affiliated with the industry is hard. What steps are you and your members taking to help the average consumer understand that?

Dominick Pallone

Well, you're absolutely right — health literacy is a focal point for a lot of our members. That includes things as simple as maintaining their call centers and making sure they have an actual human answering the phones and walking people through what their coverage looks like and what it means to have that coverage. Oftentimes, the individual isn't the one making the purchase of their healthcare coverage — in the state of Michigan, it's most often their employer. In those scenarios, we work both with the employer's HR team and with the individual members, or enrollees, themselves, to explain their benefits and educate them a bit on how best to use them. By that, I mean we're seeing a lot of new tools come into place here in Michigan from the insurance side, trying to encourage individuals to shop for their healthcare coverage based on the value and quality we see from claims data. It's very much in-the-weeds stuff, hard to explain to the average person, but for the average person, it usually just means using an app — figuring out, if I need an elective procedure, which provider will give me the best value. That could be based on healthcare quality outcome scores, cost, or both. That's really the newer frontier our members are navigating, and we're trying to help explain to people throughout the state that they have some power in that. Nobody likes it when their copay or deductible is high, so we try to do our best to explain why that is, what their employer has selected, and why — and then empower the individual to do what they can to keep their personal costs low while still maintaining access to quality care.

Richard Helppie

So, a bit more custom-designed.

Dominick Pallone

Yes, a lot more custom design these days. Sometimes that takes the form of high-value networks — we'll work with employer groups and providers to tailor a network that's more attuned to the community where the employer group is based. Oftentimes, it's just a matter of figuring out whether the provider group is willing to negotiate a value-based payment arrangement, and if so, great — we want to send our members to those providers because we know they're a trusted partner in providing high-value care.

Richard Helppie

Terrific. Any final comments or thoughts for our audience today?

Dominick Pallone

Well, I just appreciate the discussion, as always. We've got a lot of work ahead of us in the state — I don't think anybody in healthcare is happy with where we find ourselves. I hear it from my family and friends across the state: we've got affordability issues at play, and we've got some hard work ahead. We're excited to work with partners like the MHA and others who are willing to take this on, and, as I mentioned earlier, I think the pharmacy levers are the policy levers we need to focus on right now in our state. So we're excited to roll up our sleeves and get to work on that over the next few months.

Richard Helppie

We've been talking with Dom Pallone, chief executive of the Michigan Association of Health Plans. On behalf of the Michigan Health and Hospital Association and the Common Bridge, this is your host, Rich Helppie, signing off.