March News Notes

The House of Representatives will be voting on a bill that will start the process to reduce $800 billion from Medicaid over the next decade. Medicaid provides essential health care and services to millions of children and adults with disabilities. Medicaid provides:

• Infants with disabilities get a strong start in life through vital developmental support.

• Millions of people with disabilities access the health care they need to live healthier fuller lives.

• People with disabilities receive assistance from home care workers for daily tasks, ensuring independence and dignity.

State Budget Update

On February 5, Governor Gretchen Whitmer’s State Budget Office team presented the Fiscal Year 2025 –2026 (FY 26) Executive Budget Recommendations to a joint meeting of the House and Senate appropriations committees. This year’s presentation offered a $83.5 billion budget recommendation that includes a general fund total of $15.3 billion and a School Aid Fund total of $21.2 billion. New investments proposed by the Governor include:

• $96.4 million to increase the asset limit and spend down threshold for Medicaid beneficiaries from under 40% of the Federal Poverty Level to 100%.

• $3.2 million for Children’s Special Health Care Services orthodontic rate increase.

• $516 million to support school operations through a 4.1% increase in base per-pupil funding— equating to an additional $392 per student, for a total of $10,000 per pupil.

• $202.4 million to continue expanded support for special education students – a 10% increase in the state allocation from adjusted current law levels.

• $258 million to support the mental and emotional wellbeing of 1.4 million students through continuation of mental health and safety grants to districts.

The proposed budget did not include an increase for the Direct Care Worker Wage but rather continues to support the wage as passed in Fiscal Year 2024 – 2025 budget.

Legislative Update

By January 1, 2027, Michigan’s minimum wage will be $15/hour. The wage will gradually increase to $12.48/hour on February 21, 2025, and to $13.73/hour on January 1, 2026. Tipped minimum wage will rise to 50% of the state’s general minimum wage by January 1, 2031.

Regulatory Updates

The Michigan Department of Health and Human Services (MDHHS) issued a press release on January 9 sharing that Michigan had been selected by the Centers for Medicare & Medicaid Services (CMS) to participate in the Innovation in Behavioral Health (IBH) Model. The model supports aligning payment between Medicaid and Medicare for integrated services, as well as improving quality reporting and data sharing. The overall goal of the IBH Model is to improve quality of care and outcomes for adults enrolled in these programs with moderate to severe mental health conditions and substance use disorder (SUD).

Have a Great March,

Kevin