MHA Hospital Priorities Fully Funded in Legislative Budget Proposals

capitol building

The state House of Representatives and Senate advanced budget proposals May 13 for both the current year and the upcoming fiscal year that fully fund hospital priorities, including new MHA Board of Trustees’ priorities from its April meeting. 

During that meeting, board members discussed several possible funding items that could be used to address the ongoing and worsening behavioral health crisis in Michigan and its significant impact on hospitals and patients. The board directed the MHA to focus on funding to address these issues and work toward better patient care. The House budget proposal approved May 13 includes $125 million to add pediatric psychiatric patient beds at hospitals, improve care of behavioral health patients in the emergency department and add additional settings of care for behavioral health cases.

In addition, the House and Senate included a separate MHA priority of $160 million in COVID-19 relief funding for hospitals as they continue to respond to the pandemic. The payments are allocated proportionate to statewide Medicaid inpatient volume over the previous 12 months and will assist hospitals in maintaining the resources they need to improve the health of Michigan citizens. 

The Michigan House and Senate also advanced their respective budget proposals for state fiscal year 2022, beginning Oct. 1, 2021. Both the House and Senate proposals protect key hospital priorities, including full funding for:

  • 21% increase in hospital Medicaid outpatient rates that took effect Oct. 1, 2020.
  • Critical access hospital-specific Medicaid outpatient rate increase that took effect Jan. 1, 2020.
  • Graduate medical education.
  • Disproportionate share hospital payments.
  • Healthy Michigan Plan.
  • Rural access pool.
  • Obstetrical stabilization fund.

On the legislative side, a proposal from the House includes new provisions that would streamline the prior authorization process for Medicaid managed care and reduce the timeframes for prior authorization approvals. In addition, language was added in the House proposal that would prohibit the use of any Michigan Department of Health and Human Services funds for vaccinations under a mandatory vaccination program. The MHA is concerned that this provision could hinder state vaccination efforts and will work closely with legislators to understand the impact of this language and address potential issues.

The proposals are now likely to be negotiated between the House and Senate before advancing to the governor’s desk for approval or veto. The negotiations are likely to last several more weeks. Members with questions may contact Adam Carlson at the MHA.