State legislature considers privatizing mental health care

GRAND RAPIDS, Mich. (WOOD) — Big changes could be coming to Michigan’s mental health care system, as more people seek treatment after two years of the pandemic.  

HealthWest in Muskegon is seeing more patients than ever for mental health services. 

“We have more people coming in our doors asking for help than we ever have,” Executive Director Julia Rupp said. “We also have greater levels of need. People are really hurting right now.” 

Two bills currently working their way through the Michigan State Senate, SB 0597 and SB 0598, would privatize the state’s mental health system. Insurance companies would control plans for Medicaid patients, instead of public entities. 

Sen. Aric Nesbitt, R-Lawton, said that currently, vulnerable residents “are forced to navigate a disjointed and fragmented system.” The goal of the legislation, he said, is “providing choice to patients” and making sure “they’re the ones in charge.”

“I don’t think patients have enough choices to make sure they’re taken care of,” Nesbitt said. “Today’s system benefits those I think with the financial means to navigate the systems, while those who lack the resources often suffer from inadequate care.” 

Rupp opposes the effort, saying it will take away local control and decrease access to mental health treatment. 

“Right now, if you walk in our door and you ask for services, it doesn’t matter if you have Medicaid, private insurance, or no insurance, we’re going to provide that service to you,” she said. “We will bill the appropriate people to make sure you get the care you need.” 

That would change if these bills pass, Rupp said. Additionally, she said insurance companies don’t have as much experience in dealing with patients with serious mental illness. 

“Sometimes, you need to spend more money for a higher cost of treatment up-front to help people get better quickly,” Rupp said. “They put that off and say, ‘We’re just going to try something at a lesser cost first.’ Those are the kinds of bad decisions that can be made that can hurt a person’s life.”

Nesbitt, on the other hand, said the bills would improve coverage for Medicaid patients.

“Most Michiganders with private or employer insurance receives coordinated physical and mental health care coverage,” Nesbitt explained. “And I think it makes sense that our Medicaid patients and those without the means have that same ability.” 

He also said the measures would strengthen the entire market.

“I think providing more choice, providing some competition will help improve quality, will help improve services that are there,” Nesbitt said. 

Rupp disputed that, saying it wouldn’t give families more options. 

“Options happen locally, options happen with your provider,” she said. “When you go to your doctor, what services can your doctor’s office provide you? Sometimes we provide services Medicaid doesn’t even pay for. We provide options that go way beyond the Medicaid benefit.” 

“Nobody can tell me how it’s going to give me more options,” she added. “It’s not going to increase the providers that are available.” 

Sen. Mike Shirkey, R-Clarklake, who introduced the bills last summer, said they would make mental health care “fully integrated with physical health.” 

“Through this critical reform, mental health care provided by the state of Michigan will be portable and more accessible, no matter where you call home,” Shirkey said in the statement. 

Rupp said HealthWest is already doing integrated care. 

“We provide primary health care in this building as well as behavioral health care,” she said. “We believe we do all the things they say they’re going to fix.” 

Additionally, Rupp said the bills are going to raise costs. 

“About $300 million a year,” she said. “Currently, the public system, when we manage the dollars, we bill a 6% administrative rate. The average for-profit administrative rate is closer to 15%.” 

“For the $3.5 billion that’s in the system, that’s an extra $300 million that would go toward administration in private insurance and away from services,” Rupp explained. 

In response to whether the bills would raise costs for families, Nesbitt said those opposed to the bills “are folks that are just opposed trying to throw out red herring arguments that don’t hold water.” 

“When you actually look at the studies and look at it, it’s about improving services for those most vulnerable to those in our society,” Nesbitt said. “I think they’re just throwing out poll-tested buzzwords instead of looking at the real issues that are needed to help improve our mental and behavioral health systems in the state.” 

Michigan NAMI has released a list of the groups that oppose this legislation, including several in the West Michigan region that provide mental health services. 

Nesbitt said the bills are on the Senate floor, and he’s hoping to see a bipartisan vote “in the near term.”