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HealthWest and West Michigan CMH Named as One of Three Pilot Sites for the State’s Section 298 Initiative

April 4, 2018

Financial integration with the Medicaid Health Plans slated to begin October 1, 2018

The Michigan Department of Health and Human Services (MDHHS) recently announced the three pilot sites selected for the state’s 298 Initiative, or Medicaid Health Plan Pilot. HealthWest (Muskegon County’s Behavioral Wellness Connection) and West Michigan Community Mental Health (West Michigan CMH) were awarded and will be conducting a joint pilot. Also chosen for the pilot were the Genesee Health System and Saginaw County Community Mental Health Authority.
The Section 298 Initiative is a statewide effort to improve the coordination of physical health services and behavioral health services in Michigan. This initiative is based upon Section 298 in the Public Act 268 of 2016. The Michigan legislature approved a revised version of Section 298 as part of Public Act 107 of 2017.

Under the revised Section 298, the Michigan Legislature directed MDHHS to implement up to three pilot projects to test the integration of publicly-funded physical and behavioral health services. MDHHS has been working since August to develop the structure of the pilots, which focuses on payer-level integration of Medicaid-funded physical health and behavioral health services. This will be at least a two year pilot and will include an evaluation conducted by the University of Michigan. The University of Michigan evaluation team is identifying performance metrics for the evaluation of the pilots and for the demonstration project.

This pilot changes the structure for how Community Mental Health systems are funded in Michigan. In the current model, Medicaid funding for CMH services is managed separately from Medicaid funding for physical health services. Under the 298 Pilot, the funding for both behavioral health and physical health services will flow through the same entities. This change in funding flow means that both HealthWest and West Michigan CMH will contract directly with the region’s Medicaid health plans as a behavioral health care provider and network manager.

Historically, Community Mental Health Systems, like HealthWest and West Michigan CMH, have been charged with providing care to those with a “severe” diagnosis. This pilot expands community mental health services in these communities to those with a mild to moderate behavioral health diagnosis.

Also, in the pilot HealthWest and West Michigan CMH will form a new coordinating agency for management of Medicaid Substance Use Disorder (SUD) dollars. The new coordinating agency will also directly manage other funding for SUD services and prevention, including Block Grant and PA2 (Liquor Tax) dollars.

“We can’t truly integrate care without integrating funding,” says Lisa Williams, Executive Director at West Michigan CMH. “The pilot gives us the chance to use savings resulting from improved care coordination to expand the services we provide to more people, and to better manage care for the whole person. Research shows that integrated care leads to better outcomes for the individuals served.”

“This pilot is the future of integration,” says Julia Rupp, HealthWest Executive Director. “ Our leaders and the board of directors feel that by stepping up for the pilot, we can create a model for this change that would result in improved services, increased satisfaction and better outcomes for the people we serve.”

The clinical care model is based on a national model called Certified Community Behavioral Health Clinics (CCBHC). Under the pilot, HealthWest and West Michigan CMH will continue to provide all their core services but would additionally expand access to critical services such as care coordination for persons with a broader spectrum of behavioral and physical health needs. MDHHS will work with the selected Community Mental Health Service Providers (CMHSP) and Medicaid Health Plans (MHP) to finalize the contracts and structure of the pilots. The pilot does not change HealthWest’s or West Michigan CMH’s current relationships with their residing county governments.

It is anticipated the pilot will be implemented by Oct. 1, 2018. Community forums will be held over the next few months to better explain this transformation to individuals served, providers and the community at large. For more information about the Section 298 Initiative, visit

Click here to view the RFI submitted by West Michigan CMH

Click here to view HealthWest’s Pilot for Section 298 Announcement

Have questions about the Pilot? 

Cece Riley
HealthWest Communications Coordinator
Phone: (231) 332.3884

Kimberly Goodrich
Assistant to the Executive Director
Phone: (231) 843.5401