By Lily Guiney
Gongwer News Service
A full day of arguments and testimony in a lawsuit seeking to block the Michigan Department of Health and Human Services from rebidding prepaid inpatient health plans ended last Thursday evening with a judge saying he'll likely skip ruling on a request for preliminary injunction and issue a declaratory judgment to resolve the case.
Michigan Court of Claims Judge Christopher Yates said he plans to have an opinion prepared to publicize in Region 10 PIHP v. State of Michigan on Tuesday, Oct. 14.
The lawsuit was brought in response to DHHS issuing an August request for proposals, or RFP, from entities to bid as new PIHPs covering mental and behavioral health care for patients with specialty needs. The RFP outlined new parameters for PIHP bidders which plaintiffs say violate the Mental Health Code and cause irreparable harm to the community mental health system many Michiganders rely on.
Currently, the state has 10 regions under DHHS, each managed by a PIHP charged with disbursing Medicaid funds to county mental health agencies and monitoring compliance with state and federal law. In the RFP, DHHS's new parameters
reduce the number of regions to three and, in effect, prevent the existing 10 PIHPs from bidding because PIHPs, under statute, only have authority in their service areas.
The lawsuit asserts DHHS drew the three new regions so that none of the existing PIHPs had a matching service area. One covers Macomb, Oakland and Wayne counties, all of which currently have their own PIHP. Another covers the Lower Peninsula from Mason, Lake, Osceola, Clare, Gladwin and Arenac counties south to the state line. The other covers the Upper Peninsula and the rest of the Lower Peninsula.
Some mental health groups have argued that the rebid of PIHPs constitutes privatization of the community mental health system, an argument DHHS has rejected since public entities are allowed to submit bids. However, since the 10 existing PIHPs cannot cover the service areas outlined in the new RFP, they're effectively locked out of the bidding process unless they completely restructure themselves under new entities.
Plaintiff attorneys argued last Thursday that since the deadline for bids to be submitted to DHHS for consideration is Monday, October 13, at which time Yates will still be deliberating, the currently existing PIHPs would effectively cease to exist if the declaratory judgement doesn't go their way. The RFP sets an October 2026 deadline for new PIHPs to officially take effect, but attorneys for the current 10 said continuity of care cannot be guaranteed for all patients in the interim if Yates allows DHHS to move forward with its rebidding next week.
DHHS attorneys argued that the Mental Health Code and additional statutes give the department sweeping authority to select and approve PIHPs, with or without the consent of community mental health agencies.
"The Legislature clearly delegated that responsibility to DHHS, so whether any of us in this room agree with the policy changes or not, it doesn't make them illegal," the department's lead counsel said in a closing statement to Yates.
Yates pressed both parties throughout the day with questions and requests for further information and said on multiple occasions that both sides had valid claims. He admitted to believing DHHS's decision to issue the RFP was a poor one but acknowledged his policy opinion has no bearing on the legal facts of the suit or his decision.
"I don't know whether it's good news or bad news for you," he said while addressing departmental attorneys before sending the courtroom home for the day, "that I think this is terribly unwise but quite probably legal."
Gongwer News Service
A full day of arguments and testimony in a lawsuit seeking to block the Michigan Department of Health and Human Services from rebidding prepaid inpatient health plans ended last Thursday evening with a judge saying he'll likely skip ruling on a request for preliminary injunction and issue a declaratory judgment to resolve the case.
Michigan Court of Claims Judge Christopher Yates said he plans to have an opinion prepared to publicize in Region 10 PIHP v. State of Michigan on Tuesday, Oct. 14.
The lawsuit was brought in response to DHHS issuing an August request for proposals, or RFP, from entities to bid as new PIHPs covering mental and behavioral health care for patients with specialty needs. The RFP outlined new parameters for PIHP bidders which plaintiffs say violate the Mental Health Code and cause irreparable harm to the community mental health system many Michiganders rely on.
Currently, the state has 10 regions under DHHS, each managed by a PIHP charged with disbursing Medicaid funds to county mental health agencies and monitoring compliance with state and federal law. In the RFP, DHHS's new parameters
reduce the number of regions to three and, in effect, prevent the existing 10 PIHPs from bidding because PIHPs, under statute, only have authority in their service areas.
The lawsuit asserts DHHS drew the three new regions so that none of the existing PIHPs had a matching service area. One covers Macomb, Oakland and Wayne counties, all of which currently have their own PIHP. Another covers the Lower Peninsula from Mason, Lake, Osceola, Clare, Gladwin and Arenac counties south to the state line. The other covers the Upper Peninsula and the rest of the Lower Peninsula.
Some mental health groups have argued that the rebid of PIHPs constitutes privatization of the community mental health system, an argument DHHS has rejected since public entities are allowed to submit bids. However, since the 10 existing PIHPs cannot cover the service areas outlined in the new RFP, they're effectively locked out of the bidding process unless they completely restructure themselves under new entities.
Plaintiff attorneys argued last Thursday that since the deadline for bids to be submitted to DHHS for consideration is Monday, October 13, at which time Yates will still be deliberating, the currently existing PIHPs would effectively cease to exist if the declaratory judgement doesn't go their way. The RFP sets an October 2026 deadline for new PIHPs to officially take effect, but attorneys for the current 10 said continuity of care cannot be guaranteed for all patients in the interim if Yates allows DHHS to move forward with its rebidding next week.
DHHS attorneys argued that the Mental Health Code and additional statutes give the department sweeping authority to select and approve PIHPs, with or without the consent of community mental health agencies.
"The Legislature clearly delegated that responsibility to DHHS, so whether any of us in this room agree with the policy changes or not, it doesn't make them illegal," the department's lead counsel said in a closing statement to Yates.
Yates pressed both parties throughout the day with questions and requests for further information and said on multiple occasions that both sides had valid claims. He admitted to believing DHHS's decision to issue the RFP was a poor one but acknowledged his policy opinion has no bearing on the legal facts of the suit or his decision.
"I don't know whether it's good news or bad news for you," he said while addressing departmental attorneys before sending the courtroom home for the day, "that I think this is terribly unwise but quite probably legal."
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