JACKSON, Mich. (WILX) – Mental health advocates are concerned about the future of patient care as the state health department prepares to shift gears.
Changes are coming in Michigan for behavioral health services and how they’re provided through Medicaid.
Behavioral health services are typically provided by local level organizations, but now, the state of Michigan wants to create a bidding pool that could include larger non-profit groups.
“It’s going to be profit-driven, not care-driven,” said David Lowe, Executive Director of Access and Crisis Services at LifeWays.
Lowe said the mental health organization prides itself on being connected to the communities it serves in Jackson and Hillsdale counties, but LifeWays leadership is worried about what the health department’s change might bring.
“This is not just a policy change. It is a threat to the public system we have built together with our partners, providers, and—most importantly—our consumers,” LifeWays CEO Maribeth Leonard wrote in a statement sharing fears about the shift. “Privatization risks fragmenting care, weakening local oversight, and prioritizing profits over people. It would undo decades of work focused on collaboration, community voice, and person-centered recovery.”
Michigan offers prepaid insurance coverage for people enrolled in Medicaid across the state through a number of contracts based on region.
In an effort to expand access to behavioral health services, the department is readjusting those regions and asking that nonprofit groups compete with each other for contracts.
“And as a result, we’re afraid that moving into a larger system would force us to lose our local level voice and our local level advocacy as it relates to behavioral health policies and procedures and service provisions,” Lowe said.
Lowe added that it’s because a bidding process opens the door for much larger nonprofits to swoop in and take up the contract for their region, possibly making services less local.
Not only that; he’s also concerned that LifeWays may not qualify as a bidder.
“The challenge is that our existing PIHP structure may not be able to exist and be a potential bidder based on the rules and the standards that would be proposed in that bid proposal,” he told News 10.
In response to LifeWays’ concerns, the Michigan Department of Health and Human Services issued the following statement:
“The Michigan Department of Health and Human Services (MDHHS) is changing to a competitive procurement process for the state’s Prepaid Inpatient Health Plan (PIHP) contracts to help ensure Michigan Medicaid beneficiaries have access to behavioral health care services when and where they need them.
MDHHS proposed the competitive bidding process to address issues within the current PIHP system that compromise service quality, accountability and efficiency. Informed by extensive feedback collected through a recent survey of Medicaid beneficiaries and their families, advocacy groups, community-based organizations and other partners, MDHHS identified several issues in the 10-region structure – 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.”
The plan is for the department to open up the bidding process this summer with the goal of starting services in October of 2026.
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