Governor Gretchen Whitmer released her FY 2023 executive budget last week. The Department of Health and Human Services (MDHHS) budget accounted for $33.4 billion gross funds including $248 million to improve access to dental services and $859 million for Medicaid caseload adjustments. The MDHHS budget accounts for 45% of the state’s overall budget.
Other highlights of Whitmer’s executive budget include behavioral and mental health structural reform, reducing racial disparities, and investments for front line workers.
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“Crucial health care funding sources remain protected in the fiscal year 2023 executive budget recommendation,” said Brian Peters, CEO of the Michigan Health and Hospital Association (MHA). “We’d like to express our gratitude toward Gov. Gretchen Whitmer and her administration for their commitment supporting rural and critical access hospitals, graduate medical education, the Healthy Michigan Plan and Michigan’s Medicaid population.”
Whitmer’s budget would streamline access to the Medicaid Dental Benefit. The proposal allocated $243.3 million towards contracts with Dental Health Plans and $4.3 million to increase the dental procedure reimbursement rate. Roughly 28% of the $248 million comes from the general fund.
These funds will go towards procuring Health Kids Dental, Health Michigan Plan Dental (HMP), and fee-for-service adult services through a single managed care contract. This is in response to the falling Medicaid dental services utilization in the state, as shown below.
The budget report said:
“The intention of establishing a new single managed care contract for Medicaid and HMP dental services is to align access and utilization of dental care for adults to the levels enjoyed by children in Healthy Kids Dental. [This chart] highlights the success of Healthy Kids Dental in driving appropriate utilization of dental service.”
Whitmer’s budget also appropriates funds to promote mental health and behavioral health expansions. The budget appropriates $30.5 million to “purchase access to private behavioral health supports for 48 adults and 12 children.” It will provide a resource for intensive treatment—including crisis stabilization and medication—outside of traditional state inpatient facilities.
It will also allocate $325 million in one-time funding to create a new psychiatric hospital campus in the state to operate alongside Hawthorn Center and Walter Reuther State Hospital.
The budget prioritizes expansion for behavioral health capacity by allocating $16.8 million to expand behavioral health homes and opioid health homes. These funds will allow MDHHS to expand these homes into more counties and provide care coordination services for adults with serious mental and behavioral health conditions.
Reducing racial and economic disparities was allocated $20 million in the budget. This includes $10 million to create racial disparities incentive pool for Medicaid health plans, which would pay plans depending on how well they meet “department-established service and/or outcome for services including postpartum care, childhood immunizations, well child visits, etc.”
The budget also allocates $4.2 million for expansion of Centering Pregnancy sites across the state. Under this program, patients receive 10 visits with a provider team before birth. “These sites emphasize group prenatal care, support, and education to dramatically reduce racial disparities in preterm births.”
The budget also allocates $1.4 million to expand the Health Moms Health Babies program aimed at providing access to doula care for families at higher risk of poor birth outcomes.
With workforce shortages and access issues remaining a significant concern in the state, Whitmer’s budget allocates $500 million of “Hero Pay” for essential workers, which includes frontline health care workers. It also includes $150 million to behavioral health workers and $60 million for nursing home and non-direct care workers.
This is in addition to the $300 million for the health care workforce for recruitment, retention, and training that the legislature approved earlier this month.