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Commissioners warn MDHHS rebid could shrink local mental health oversight, create $20 million shortfall
Summary
Commissioners discussed planned state-level rebidding of mental health contract regions and raised concerns that the shift to PIHPs could reduce local representation and create large funding shortfalls for Riverwood and county services.
County commissioners spent part of the June 19 meeting discussing proposed changes by the Michigan Department of Health and Human Services (MDHHS) that would rebid behavioral health service regions and move responsibilities from community mental health agencies (CMHs) to Prepaid Inpatient Health Plans (PIHPs).
Commissioners said the state’s plan would reduce the existing nine regions to three larger regions and transfer operational responsibility away from locally governed CMHs. One commissioner said Riverwood — the local CMH entity referenced repeatedly in discussion — faces roughly a $20 million operating shortfall under the proposed changes and that the reorganized regions could reduce the quality of care and local oversight.
“It's going to take away local representation for offering these services,” a commissioner said during reports, noting Riverwood leadership planned meetings with state representatives to discuss the potential impact. Commissioners said county associations and the Riverwood CEO were speaking with Rep. Andrews and Rep. Paquette about the changes; the transcript records county leaders opposing the plan and considering legislative options to urge the state to adjust or delay the proposal.
Commissioners also noted timing concerns: the rollout was discussed for possible approval before November elections, which some said would complicate oversight if newly elected officials later disagreed with the changes.
The discussion in the meeting was informational: no county-level motion to oppose or to take formal action was recorded in the transcript. Commissioners described outreach and coordination with other counties and with state lawmakers as ongoing.
Background: Commissioners said MDHHS would rebid behavioral health contracts so that PIHPs assume responsibility currently held by CMHs, and that the change is scheduled to take effect in October 2026 according to meeting remarks.
Next steps mentioned in the meeting: Riverwood’s CEO planned meetings with state representatives; county leaders said they would continue discussions through county associations and legislative outreach.
