Possible Federal Cuts To Medicaid, Education Always On Flood’s Mind
State Treasurer Rachael Eubanks and State Budget Office Director Jen Flood said they have been watching the federal government “daily” to see if any changes could hit what the state expects in their 2026 budget.
Speaking at an Institute for Public Policy and Social Research (IPPSR) event, Flood said she has seen proposed federal cuts to nearly $900 million in Medicaid funding and a possible 10 percent removal from education in federal grant funding because of the dismantling of the U.S. Department of Education.
“I can say Medicaid is on my mind every day right now. Michigan is one of the states that actually draws down more federally than a lot of others,” Flood said.
She said the federal government was looking to wrap up reconciliation before Easter, but she didn’t know if or when it would happen.
“Hopefully these changes are out away, so we have some time to figure out how it would impact the state, but we’ve got to start preparing for different scenarios,” she said.
Flood said Gov. Gretchen Whitmer’s current budget still stood because there were no federal changes that had been passed federally. If that happened, it would cause a “recalibration” of the budget, even if it were already passed when the cuts were made.
She said she hasn’t seen a massive correction during the time she’s worked in government.
Were the state to take a massive hit, Flood said the “rainy day” funding was sitting at $2.2 billion, which could do some “temporary patching” of the budget.
“If there’s major ongoing cuts, it would require either reprioritizing existing spending where we have discretion, or doing some one-time patches, but we are always looking with an eye towards fiscal responsibility and sustainability,” she said.
Eubanks said the Treasury hadn’t started the forecasts for the May Consensus Revenue Estimating Conference (CREC), so it was too soon to tell if the models would be upended by threats or implementation of tariffs.
She said the Research Seminar in Quantitative Economics was one of the economic organizations the Treasury talks with. RSQE Director Gabriel Ehrlich said the next forecast study would be released in May, after an update in February.
“We’re monitoring all of the developments at the federal level daily. You know, these details do matter,” Eubanks said.
Residents, Fellows To Strike At Medical University In Kalamazoo
Residents and some fellows at the Homer Stryker MD School of Medicine at Western Michigan University (WMed) announced they would strike after sending a 10-day notice to hospital and university officials.
WMed resident Adrian Palmer said the union didn’t want patients to be hurt, but they were also looking for better working conditions and they felt management had been giving them the same treatment over and over.
“Dismissing our valid concerns about the need for fair salaries and respect in the workplace. We’re hoping this notice will push WMed to deliver on their stated mission of equity and professionalism so we can provide the best possible care for our patients,” Palmer said.
Union representatives told MLive reporter Aya Miller that the strike was likely to last two days.
The resident physicians said they were being supported in their collective bargaining by Rep. @Julie Rogers (D-Kalamazoo), who sent a letter to WMed Chair and Western Michigan University
WMed Communications Director Laura Eller said the medical school is not part of Western Michigan University and, while affiliated, is a separate entity.
The Resident and Fellow Alliance is backed by the American Federation of Teachers Michigan (AFT). Residence are physicians in training after graduating from medical school and supervised by attending physicians or senior residents. Practice of medicine is usually limited.
“WMed is disappointed to learn that some of our residents and fellows have chosen to participate in a strike,” Eller said in a statement.
She said the WMed team had been negotiating with the RFA in good faith and that officials are participating in the bargaining sessions.
“The parties have been able to reach numerous tentative agreements so far and have made excellent progress on creating their first contract. WMed is committed to continuing these negotiations with the goal of reaching a fair and mutually beneficial collective bargaining agreement that addresses the concerns of both parties,” reads the WMed statement.
EMS Company Sues State For Unpaid Ambulance Rides To Prisons
An emergency medical service provider has asked a court to order the state to pay it $770,159 plus interest for unpaid services provided to Michigan prisoners.
Mobile Medical Response’s (MMR) Court of Claims lawsuit alleges the state has unjustly enriched itself by failing to pay for 582 ambulance rides between July 2002 and April 2024 to various Department of Corrections’ facilities.
“The State of Michigan freely chose to contract with Wellpath, who failed to pay subcontractors despite services being provided to MDOC facilities,” said Saginaw attorney Peter S. Shek in the lawsuit.
In addition to the MDOC, the suit names the Department of Technology, Management & Budget as a defendant. Neither department returned a message seeking comment.
The state contracted with Grand Prairie Healthcare Services and Wellpath in 2021 to provide healthcare management to MDOC inmates.
That care encompassed general health care, psychiatric care, dental care and pharmacy services.
Wellpath’s contract required the company to pay subcontractors, like MMR, within 45 days of a claim being made, but the lawsuit alleges payment was not made.
Michigan Association of Ambulance Services (MAAS) has said more than a dozen EMS providers are owed a combined total of $6 million in unpaid healthcare services, and those providers have sought help from lawmakers.
Wellpath has faced a number of lawsuits, including one from the state of Michigan, who filed for breach of contract after the company failed to pay $35 million in medical bills.
The state’s lawsuit, however, was placed on hold after the company’s parent company filed Chapter 11 bankruptcy in a Texas federal court.
Michigan’s Infant Blood Collection Program Scrutinized In Federal Court
Roughly 95 percent of the complaints against the state’s collection of infant blood samples have been disproved, according to an attorney for the Michigan Department of Health and Human Services during a federal appellate court hearing on the state’s Newborn Screening Program (NSP).
The 2018 lawsuit, filed on behalf of four parents, alleges the state violated their children’s Fourth and Fourteenth amendment rights for storing, using or transferring their infants’ blood samples.
Michigan’s NSP essentially calls for the collection of newborns’ blood, which is medically tested for various genetic conditions.
In 2019, the Sixth Circuit held parents could challenge the state’s policy and in 2022 the parties reached a partial agreement that called for the state to destroy or dispose of those dried blood spots.
In July 2023, U.S. District Judge Thomas L. Ludington became the first judge in the country to grant an injunction that gave the state one year to obtain informed consent from the parents “for the retention and use of their children’s samples and the associated data.”
Ludington held that the NSP program violated the plaintiffs’ Fourth and Fourteenth amendment rights.
Assistant Attorney General Daniel Ping told the U.S. Sixth Circuit Court of Appeals panel that the program does “measurable life-saving work for Michigan families” and has saved thousands of babies.
Hemlock attorney Philip Ellison, who represents the plaintiffs, led by Adam Kanuszewski, acknowledged the blood spots for his clients’ children have been returned.
However, Ellison argued that the state continues to retain private medical data, which violates parents’ rights to direct their children’s medical care and privacy rights.
Ping disagreed, emphasizing the importance of Michigan’s newborn screening program, noting that it doesn’t interfere with parents’ right to direct their children’s medical care.
Ping also argued that MDHHS engages in no medical care or treatment, nor does the department perform or facilitate research on identifiable individuals.
“I can’t really get my head around the idea that this is medical care, medical treatment, even medical diagnosis at the most generous,” he said.
Jeremy Kennedy, who represents the Michigan Neonatal Biobank, said his client is “essentially a storage facility” as they just hold the data for potential use down the road, and that storage is not a medical procedure.
Ellison agreed the claims against the Biobank are moot, but his clients’ data-claim against MDHHS is not because the state maintains his clients’ private medical data and genetic data while the case is appealed.
Ellison said the state admits it keeps the blood spots and related data for potential future “diagnosis,” which is a medical purpose.
Circuit Judges Richard Allen Griffin, John B. Nalbandian and Andre B. Mathis questioned whether they were bound by a previous panel’s 2019 decision on substantive due process, which is a legal principle that means the government can’t infringe on fundamental rights, even if those rights are not explicitly mentioned in the Constitution.
Ellison said it is binding, and that a prior panel held that retaining, transferring and storing the samples indefinitely without informed consent constitutes denial of parents’ fundamental right to direct medical care for their children.
Ping disagreed, saying the prior decision was essentially one made as a motion to dismiss the lawsuit.
$22.8 Billion Needed To Bring Schools Up To Basic Health, Safety Standards, Study Says
Fixing 2,534 Michigan school buildings to meet health, safety and wellness standards will cost $22.8 billion with the needed HVAC and roof repairs costing $10.9 billion alone, according to the School Finance Research Foundation’s (SFRF) Statewide School Facilities Study.
The foundation looked at the quality of HVAC, roofing, electrical, plumbing, exterior closures, interior construction, fire protection, site improvements, construction framing and other building components.
Of the proposed $22.8 billion, 99.1% is allocated for repairs, while 0.9% would be invested in replacing appliances. 2,508 of the buildings surveyed were found to be most cost-effective to repair, while 26 would be more cost-effective to replace the facilities.
“This study will help educate the policymakers, school community and general public about the critical infrastructure needs facing so many of our schools,” said SFRF Executive Director Steven Ezikian.
“We look forward to working with school leaders across Michigan to make school facilities an important part of the school funding conversation in 2025 and beyond. We encourage policymakers, school leaders, members of the media and the public to use this groundbreaking study as a resource for shaping important public policy discussions that affect our students for generations to come,” he said.
Did The COVID Lockdowns Work?
State government’s reaction to the COVID-19 pandemic is about four years in the rearview mirror. That’s a perfect amount of time to see what worked and what didn’t work, according to the Mackinac Center’s director of research, Michael Van Beek.
Speaking this morning on Michigan’s Big Show Starring Michael Patrick Shiels, Van Beek said the degree to which emergency orders and lockdowns were used needs to be examined in order to prepare the state for the next pandemic, whenever that may be.
“There are a lot of questions that remain about what Michigan did during the COVID pandemic and I think we need to get answers to those questions,” he said. “What were the ramifications of the governor’s orders and policies that she enacted in the March of 2020? What were the benefits of the policies she chose? . . . We’ve never looked closely at that.”
When the government responds to the next pandemic, Van Beek argues the citizens need to have a better idea of what to expect. He believes this would encourage more compliance with the orders and cause less confusion. The review should look into the powers exercised by the executive branch and the health benefits seen by the public through those executive orders, he said.
In particular, Van Beek said a review should be done on government lockdowns and the extent to which stay-at-home orders worked. How long is too long to close schools? Under what circumstances should concerts and other mass gatherings happen or not happen? Should people with the virus be ordered to stay home for a certain number of days or should this be voluntary?
Much of what Gov. Gretchen Whitmer and other state governors did were novel experiments, he argued, and one of the House Oversight Subcommittees would be a perfect place to dig into whether those experiments were successful or not.