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Michigan Legislative Update


Email Alert

By Jessica M. Swartz*

June 29, 2009

In response to one of the worst economic downturns in the state since the 1930s, Michigan Governor Jennifer Granholm (D) signed Executive Order 2009-22 in early May that reduces Medicaid provider reimbursement by 4% and reduced the state Department of Community Health's budget by more than $50 million.1 According to Crain's Detroit,2 the cut in provider rates would produce $16 million in state general fund savings but reduce total Medicaid payments by nearly $53 million, which includes a $37 million loss of federal matching funds. The Senate and House appropriations committees approved the executive order.

On May 14, Michigan state senators introduced Senate Bills 579-582, which hope to expand health insurance coverage to the state's 1.2 million uninsured residents. The package, named MI Health, would establish two state health plans that provide the residents with more affordable and accessible coverage options: MI Access and MI Coverage. MI Access would expand the state Medicaid program to include residents with annual incomes under 200% of the federal poverty level, but would require co-payments for services and medications. MI Coverage would provide subsidized coverage options for residents with annual incomes at 200% to 300% of the poverty level, with fees set according to health levels and habits.

The proposed legislation package also would create a state fund that pays for insurance claims exceeding $25,000, or up to $250,000 per year. Health plans would be required to contribute to the fund. Additionally, commercial insurers would be barred from rejecting coverage for applicants with chronic conditions or increasing their premiums if they have been previously diagnosed with a chronic condition. This legislation has been referred to the Committee on Health Policy. Access a more detailed analysis of these bills.

The Michigan House and Senate are on recess from June 26, 2009, to
July 14, 2009.

*AHLA wishes to thank Jessica M. Swartz, Esquire (Washington, DC) for providing this alert.

1 Executive Order 2009-22.
2 See

For summaries of other state healthcare initiatives, please visit the Healthcare Reform Educational Task Force's website and click on Email Alerts in the left-hand navigation menu.

The Healthcare Reform Educational Task Force is a joint endeavor of the Healthcare Liability and Litigation; Hospitals and Health Systems; In-House Counsel; Payors, Plans, and Managed Care; Physician Organizations; Regulation, Accreditation, and Payment; and Teaching Hospitals and Academic Medical Centers Practice Groups.
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