Mental health advocates are criticizing a state proposal they say could privatize Michigan’s public behavioral health care system, potentially damaging the quality of care for the state’s Medicaid recipients and those with behavioral health issues.
In May, the Michigan Department of Health and Human Services (MDHHS)
proposed a competitive bidding process open to
public entities and public-private partnerships with a nonprofit organizing structure, replacing the state’s ten publicly managed Prepaid Inpatient Health Plans (PIHPs) with three state-selected entities.
Organizations that can bid as a PIHP include the nonprofit arms of major health insurance companies like Blue Cross Blue Shield, McLaren, HAP, and other major insurers, says St. Clair County Community Mental Health (SCCCMH) Chief Operating Officer Telly Delor.
Mental health advocates from SCCCMH and the Community Mental Health Association of Michigan (CMHA) criticized the proposed competitive bidding process, arguing it would open the door to privatization of Michigan’s public mental health systems.
Coupled with federal cuts to Medicaid recently passed at the federal level, mental health advocates said privatization would lead to a reduction in funding and mental health services, barriers to care for consumers, and overall degradation of public mental health care.
Such a loss of care could come with disastrous consequences for the people who depend on the public mental health system.
MDHHS representatives say the proposal will not privatize public mental health care, but will instead improve three key issues of the current PIHP structure identified in a recent stakeholder survey: fragmentation, service inconsistency, and limited accountability.
“The proposed bidding process is designed to mitigate these issues by establishing a more streamlined, transparent and equitable behavioral health framework that better serves Michigan residents and address conflicts of interest that exist within the current system,” says MDHHS Public Information Officer Lynn Sutfin.
PIHPs provide behavioral health medical services and intellectual/developmental disabilities services to Community Mental Health (CMH) agencies and other enrollees under contract with the state Medicaid agency.
Critics say the Proposal will upend the Public Mental Health System
Chief among mental health advocates' concerns is the potential reduction in funding for mental health services. PIHPs’ administrative costs are about 2% of their total budget, compared to about 15% for private insurance companies, according to CMHA Associate Director Alan Bolton. This could result in a loss of about $500 million per year in mental health services.
PIHPs are public agencies, and so must abide by requirements that provide public access to budget information, costs for services, Freedom of Information Act (FOIA) requests, and other regulations designed to promote transparency. Public-private entities would not have to operate under these regulations, losing the system’s current transparency, Bolton says.
“Right now, county commissioners appoint our local CMH system. People in the community have a venue to go if there are issues and to express concerns. There is transparency,” Bolton says. “If this is awarded to private insurance companies, we’re going to lose local control. We’re going to lose local voice.”
Currently, SCCCMH partners with local public safety agencies, governmental organizations, nonprofits, and other organizations to provide community-based services.
In partnership with SCCCMH, St. Clair County Mental Health Court provides those with substance use disorder and drug- and alcohol-related criminal charges with behavioral health treatment as an alternative to incarceration. A SCCCMH master-level clinician works full-time with the Port Huron Police Department to respond to calls involving a mental health crisis. SCCCMH employees regularly attend public events to distribute free resources and reach those who might not have otherwise known about or connected with its services.
Community services such as these, which do not directly generate income but are of great benefit, could be at risk of being cut, Delor and Johnson say.
Privatization could also lead to barriers to access for people attempting to navigate a private insurer’s at times cumbersome and confusing approval process. Insurers often place profit over the people they are supposed to serve and could have the power to deny services deemed too costly to provide, mental health advocates say.
“These private nonprofit entities are going to deny services to that person who requires high-level services that have high-level residential services that cost hundreds of dollars a day,” Delor says. “That’s going to be a real problem because then what happens to that individual if they don’t receive that level of service and what happens to the community in which that individual resides?”
State says Proposal will Improve Flaws in PIHP System
Sutfin says the state’s proposed bidding process would include standards to ensure managed care entities provide a high level of services.
“MDHHS will continue to set statewide policies, define performance standards and oversee service delivery. No reductions in Medicaid funding for behavioral health services are planned as a result of this transition. The department aims to allocate resources more strategically, with a focus on outcomes and access,” she says in an email statement. “Transition plans will be required to prioritize uninterrupted services for beneficiaries and MDHHS will monitor implementation to prevent disruptions and ensure that existing provider relationships are honored where appropriate.”
MDHHS says the proposed system will improve services through enhanced contractor standards and focused investment; increase patient choice and consistency by contracting with comprehensive and consistent provider networks; ensure accountability and transparency through MDHHS’s monitoring and reporting requirements for providers; and simplify and reduce bureaucracy by streamlining governance structure.
SCCCMH Holds Legislative Session
On July 14, SCCCMH and Macomb County CMH held a
legislative briefing with local stakeholders, local government officials, mental health advocates, and representatives from 11 state and federal lawmakers’ offices to inform the public about threats to the behavioral health system.
“These folks provide service with the multitude of staff that they have and the connectivity they have with law enforcement, educational partners, health care systems and beyond. There is a friendship, a relationship to try to figure out, how do you help people in your community? There is that continued partnership,” Macomb County Executive Mark Hackel says while addressing the crowd at the briefing. “It’s not going to happen with privatization.”
How You Can Advocate for Public Mental Health
Johnson and Delor urged concerned community members to contact their elected officials to protest the implementation of the proposed bidding process. The public can find their elected officials' names and contact information, as well as infographics, articles, and flyers on
MDHHS’s proposed changes on
SCCCMH’s website.
SCCCMH’s advocacy page has several flyers with
key talking points and
pre-written emails that can be sent to elected officials.
SCCCMH also publishes advocacy alerts on its
Facebook and
Instagram pages.
Learn more about becoming a mental health advocate with the
Community Mental Health Association of Michigan or the
National Council for Mental Wellbeing.