DIFS budget analysis reveals shifts in funding and appropriations since 2014

The Appropriations Committee for Licensing and Regulatory Affairs and Insurance and Financial Services met on March 13, 2025, to discuss the budget and funding trends for the Department of Insurance and Financial Services (DIFS) in Michigan. The meeting highlighted significant changes in funding and appropriations over recent years.

One of the key points discussed was the impact of the elimination of the autism coverage fund in 2015, which led to a noticeable drop in funding. However, there was a subsequent increase in funding in 2020 attributed to no-fault insurance reform, along with a $25 million increase in the general fund in 2021 aimed at supporting the post-acute auto injury provider relief fund. This fund provided financial assistance to medical providers.

Since 2022, DIFS has not received any general fund allocations. Over the past five years, DIFS gross appropriations have increased by approximately 7%, with full-time (FT) authorizations reflecting a similar growth. The fluctuations in funding were primarily due to economic adjustments rather than changes in full-time equivalents (FTEs) or program expansions. Notably, the FTEs added in 2023 and 2024 did not come with additional funding, as they were supported by existing departmental funds. In contrast, the 2025 budget included new FTE authorizations that were accompanied by additional funding, aimed at enhancing the department's insurance work and consumer service outreach.

For the current fiscal year, DIFS has an appropriation of about $78.6 million, which includes interdepartmental grants, federal revenue, and restricted funds primarily sourced from various license fees. Approximately 98% of the DIFS budget is state restricted, with interdepartmental grants and federal funds making up the remainder.

The discussions during the meeting underscored the ongoing adjustments and funding strategies within DIFS, reflecting the department's efforts to adapt to changing economic conditions and regulatory needs.