LANSING — The Michigan Department of Health and Human Services is drawing criticism from lawmakers about the potential distribution of millions meant for rural healthcare.
The state of Michigan is set to receive $173 million from the Rural Health Transformation Fund, a program established last year to partly offset Medicaid cuts.
But new details released by MDHHS show that Northern Michigan counties could compete with population centers in southeast Michigan for those funds, potentially limiting their rural reach.
“We are starved for healthcare infrastructure up north,” said Rep. Cam Cavitt, (R) District 106, Cheboygan. “Our people need a shot in the arm, and this is a chance to do it.”
MDHHS gave more information on how that funding would be distributed before lawmakers this week — but officials quickly received pushback on their designations of some counties as “partially rural.”
The department put Leelanau and Grand Traverse Counties in the same category as Wayne, Oakland and Washtenaw County.
Those three counties contain 3.4 million people, more than a third of Michigan’s total population, while Leelanau and Grand Traverse have a little more than 1%.
Northern Michigan lawmakers argued that larger counties can put more resources toward acquiring those funds, even though they may have much smaller rural populations.
“There’s no place in Wayne County you can go where you’re not 20 minutes from a world-class hospital or university,” Cavitt said. “There’s people in my district that drive an hour and a half in an ambulance to get to a hospital in an emergency situation. We have counties that have no neonatal care.”
Beth Nagel, a senior policy director for MDHHS, acknowledged those concerns in the hearing, saying funding for more rural counties would still be prioritized.
“In Wayne County, it looks like in that particular rural area, there may be less than 100 people,” she said. “That would not be high on the list of priorities.”
The determinations were made by MDHHS and based on federally suggested guidelines.
Gabe Schneider, director of government relations for Munson Healthcare, says that Munson is set to lose close to $80 million as a result of the Medicaid cuts.
“We know Munson health care will be significantly adversely impacted by the Medicaid cuts because of the large rural area that we serve,” he said. “We know that we need to be competitive and strategic and thoughtful in moving forward with applying for dollars from the Rural Health Transformation Program.”
Additionally, lawmakers also questioned why Michigan received some of the lowest funding per resident in the nation.
“We’re in the top 10 for rural populations — when we got this funding, we’re in the bottom 10. It’s not acceptable,” Cavitt said. “We need to do better.
Some states received funding at more than six times Michigan’s rate.
Cavitt also warned that the use of these funds will likely be heavily scrutinized by the Trump administration, which is kicking off another grant cycle this August.
“If the Trump administration sees that we’re giving money to Detroit that was meant for rural hospitals, they might claw back some of that money, or we might not qualify for the next round of funding,” Cavitt said. “So we really have to make sure that this goes to rural areas in Upper and Northern Michigan.”