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Michigan lawmakers this week take on Medicaid mental health shakeup

September 12, 2021, 11:19 AM

A State Senate committee on Tuesday plans to open public discussion of a huge health care change. Senate Republican Leader Mike Shirkey and party colleagues want to privatize management of a $3-billion Medicaid system for mental health and addiction treatment in Michigan.

(Photo: Michigan Association of Health Plans)

"This promises to be a big fight in Lansing this fall," Crain's Detroit Business posts this weekend.

Private health insurance companies have spent years lobbying the Legislature to let them manage this one remaining aspect of the state’s health insurance safety net for low-income adults and children. ...

Now, Senate Majority Leader Mike Shirkey is taking another stab at the issue of letting private insurers add mental health and substance abuse to the list of Medicaid services they already manage through the Healthy Michigan, MiChild and Healthy Kids Dental programs.

It's almost a forgone conclusion that Shirkey has the votes in his own Republican caucus to get a privatization bill passed. The big unknown right now is whether Gov. Gretchen Whitmer's administration is going to play ball with the senator on this one.

Here's the background and arguments:

♦ How it works now: Anyone in Michigan covered by Medicaid can get no-cost mental health services when a condition affects their well-being and won't improve without treatment. Medicaid covers counseling for mild or moderate mental health conditions, as well as intensive services for severe illness -- including in-patient substance abuse rehabilitation.

The Michigan Department of Health and Human Services gets a yearly federal grant of about $13 million for community mental health providers.

Medicaid recipients deal with two systems — private plans for physical needs and the public health system for mental health. Those with private health insurance get care through a single insurer.

Why proponents seek an overhaul: "Integration will significantly add to the numbers of those seeking and receiving mental health services in Michigan," writes James Haverman, Michigan's director of community health from 1996-02 and 2012-14. "Michigan needs to catch up with other states."

When he introduced two bills in July, Shirkey told lawmakers that they'd replace an "outdated" model with one that will "ensure that those who are among our most vulnerable population continue to get the services they need."

Dominick Pallone, executive director of the Michigan Association of Health Plans, posts the industry side:

Taxpayers deserve more accountability for the money spent. A contract-driven state system of managed care, which we have used in Michigan for more than 20 years for the physical health of Medicaid beneficiaries, will do that. ...

Instead of each person having two separate health plans, each person will have just one entity that will pay for and manage all of their needs.  While this concept is commonplace to persons not enrolled in Medicaid, this proposal would mean that for the first time there would be one single point of accountability for the health and wellbeing of the whole person.

♦ Why critics oppose Republican bills: The change would shift local decision-making powers to distant, for-profit insurers, say opponents. They include three groups that advocate for the more than 300,000 residents with mental illnesses -- Michigan's chapter of the National Alliance on Mental Illness, the state’s Association for Children’s Mental Health and the Mental Health Association in Michigan. 

The Senate bills would bring a "lack of accountability," says Marge Mitchell, a longtime advocate for disability rights and executive director for Michigan Universal Health Care Access Network. Private insurers answer first to shareholders rather than taxpayers, she and other critics note.

Mitchell is quoted by Crain's in a summer article that also has the voice of Fred Cummins of Southfield, who spoke to fellow members of the Alliance for the Mentally Ill of Oakland County:

"Decisions need to be made at the community level, where they deliver services, not at the top where it's about politics and money."

♦ Sen. Shirkey responds: "There's a lot of the healthcare services across the entire spectrum — not just mental health — that already been delivered by private companies that are heavily regulated by state government in an appropriate way. So there should be no fear of privatization." -- Remarks to thye Michigan Association of Health Plans in July

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