Michael (Speaker 2) briefed the full board on the state's proposal to restructure how Medicaid-managed services are handled and on an active lawsuit challenging whether elements of the state plan conflict with the Michigan mental health code. He told members a judge is likely to identify code conflicts that the state must remedy rather than block restructuring outright.

The executive report outlined why Ottawa County believes it will be disproportionately affected by changes in Medicaid enrollment categories. Using Lakeshore regional entity data, Michael showed that Ottawa's core group of high-need consumers has remained steady while overall Medicaid enrollment mix shifted during the federal public health emergency and its unwinding. "Our core hasn't changed," he said, adding that funding tied to the number of Medicaid lives (rather than needs served) can penalize counties that have helped people stabilize and leave the county with less Medicaid revenue for the same high-need population.

He called for advocacy to move the regional/state funding model toward needs-based distribution and said the county is working with MDHHS and the Lakeshore regional entity to provide data supporting that case. He also described a projected Medicaid gap that could grow to several million dollars and listed constrained options: use regional ISF funds temporarily, seek statutory/formula changes, or make organizational reductions.

Board members asked for more granular analyses (costs per individual category and projections under different Medicaid eligibility scenarios). Speaker 2 said he will provide detailed impact analysis to the board, continue stakeholder education about department vs. authority status, and pursue legislative and regional conversations on a funding formula that aligns resources with population needs.

The board did not take a final vote on restructuring but directed staff to continue analysis and public outreach ahead of county commission hearings.