In an unprecedented move on Sept. 30, Michigan Gov. Gretchen Whitmer vetoed line items in a budget of nearly $1 billion of state spending, including a provision to increase the privatization of mental health services. This provision is an effort to cut costs that involve pilot projects that combine Medicaid-managed care plans for physical health with the Medicaid-managed mental health system, which is regulated by 10 regional pseudo-public health plans. As Whitmer and the legislature reevaluate the budget and reallocate funds for state spending, there is much to consider about health care expenditures and what we as a society prioritize in terms of who should and who should not have access to care.
In broad terms, privatization in health care is the involvement of a third-party sectors other than the government in providing and regulating health-related services. What started off as a mechanism to provide comprehensive health services to the public that the government cannot keep up with has slowly emerged as profitable, with private health care companies setting unrealistic costs that patients are forced to pay for coverage. The funding of mental health care is a multi-layered dilemma. Along with potentially propagating a dangerous stigma surrounding this class of illnesses, sometimes this discussion can take away from the patients receiving true, effective treatment.
The implications of privatizing mental health care are endless. First, mental health is an umbrella term encompassing a host of illnesses, including suicidal ideation, substance abuse, depression, anxiety and bipolar disorder, among many others. Roughly 4.5 percent of adults in Michigan suffer from a serious mental illness. Of these individuals, almost half of them receive appropriate treatment for their respective conditions, with the other half battling cultural barriers and stigma. Privatizing mental health care will only exacerbate these barriers, as it limits access to those who can afford the potential premiums. The lack of access for underserved populations can result in the mentally ill being untreated or even ending up in the prison system. This result can further perpetuate the stigma that the health care system strives to alleviate: that those who are suffering from mental illness have no hope, are undeserving of our attention and are inextricably linked with crime and incarceration. Public mental health facilities increase access and awareness.
The current public-driven health care system acts as a safety net system, particularly for low-income individuals, and operates with the incentive to offer as many services as needed. The Republicans’ proposed provision in the 2020 state budget bill pushes the Michigan health care system toward becoming more privatized, which has immediate consequences. First, there will be an initial 9-percent funding cut toward client-based needs. This would put more than 300,000 Michigan residents who depend on the current health care system at risk of losing many of the services they receive. These potential negative effects all stem from the fact that privatized health care services, while they may still offer relatively high amounts of services for patients, will largely shape their services and infrastructure in a way that maximizes the amount of money being produced. This creates an incentive for them to cut back on services and raise their costs, which will only target low-income and rural families who already struggle under the current system.
A popular argument for privatizing the Michigan health care system suggests that integrating mental and physical health services (as was proposed under the budget bill) is more efficient because it would better address overall patient health and could provide administrative cost savings. While it may produce administrative cost savings, those savings would be at a huge loss. Privatized Medicaid-managed care plans aren’t typically structured with a focus on mental health services and could cut corners to save costs, which appears realistic considering it is profit-driven. Furthermore, integrating the two health services could potentially decrease necessary funding toward the mental health branch, which already is in desperate need of cash under the current state system. There have also been studies on the success of privatized health care systems, and the evidence largely does not support it. Marcia Angell, a contributing writer to the U.S. National Library of Medicine, stated that for-profit care is almost always more expensive and offers subpar treatment compared to public service. In a state lacking a comprehensive mental health system, the opportunity to rework a budget to allocate monetary resources is more crucial now than ever before.