On February 28, 2025, the Michigan Department of Health and Human Services (MDHHS) announced plans to shift how they contract for behavioral health services across the state. Through a new competitive procurement process, MDHHS will begin accepting bids for its Pre-Paid Inpatient Health Plan (PIHP) contracts—an overhaul that could dramatically alter how Michiganders’ access mental health and developmental disability services.

What Is Competitive Procurement?

In a competitive procurement system, the state solicits bids from organizations to win contracts for delivering public services—in this case, behavioral health care. While this may sound efficient in theory, past experiences with similar approaches have raised serious concerns.

Competitive procurement often results in out-of-state, for-profit companies winning contracts over trusted, local, community-based systems. These shifts threaten the public management model that has ensured Michigan’s mental health system remains grounded in the needs of local communities.

Why It Matters

As highlighted by the Community Mental Health Association of Michigan (CMHA) in the graphic below, competitive procurement could:

• Introduce funding instability and deepen service cuts.
• Disrupt continuity of care and create confusion for people relying on critical mental health and disability services.
• Shift decision-making from local communities to private, bureaucratic entities with no direct ties to Michigan residents.

There’s a Better Way

Rather than racing into a risky and disruptive bidding process, Michigan should focus on proven strategies to improve access and quality of care, such as:

• 🧠 Ensuring sufficient funding after years of flat budgets amid rising costs.
• 🗣️ Protecting local input and public accountability.
• 🧑‍⚕️ Expanding the behavioral health workforce to reduce waiting times and meet growing demand.
• 📉 Reducing administrative overhead to keep more funding directly in services.

Michigan’s public mental health system has served communities for decades, with a structure rooted in transparency, local accountability, and care—not profit. Competitive procurement threatens to upend that system.

Take Action

CMHA is urging residents, providers, and advocates to get informed and speak up. Public input is being collected—make your voice heard before decisions are made that could permanently change how care is delivered across our state.

🔗 Learn more and join the movement to protect Michigan’s public mental health system at cmham.org/advocacy/take-action-now