Michigan's Mental Health Framework
What Private Practice LPCs and LLPCs Need to Know About LOCUS, MichiCANS, PIHPs, the FY 2027 coverage changes, and the new Medicaid enrollment rules for limited licensed clinicians
Updated September 10, 2026. First published April 30, 2026.
Fact-checked and corrected September 10, 2026 against MDHHS bulletins MMP 26-01 and MMP 26-30-BH, the MHF FAQ, and the state PIHP affiliation list. Verify billing, contracting and routing decisions with the current MDHHS bulletin and the applicable MHP or PIHP. All 2026 regulatory guides →
Important Scope & Limitations
- This guide applies to CHCP Medicaid Health Plan enrollees only. The Mental Health Framework does not apply the same way to traditional fee-for-service Medicaid.
- Ages 18–20 are a crossover group. MDHHS's FAQ (updated June 4, 2026) says most enrollees 18–20 should receive the LOCUS. PIHP network providers keep using the MichiCANS Screener through age 21. When in doubt, ask the enrollee's MHP which tool they expect.
- BH-COVER is delayed. MDHHS has posted that the coverage responsibility changes scheduled for October 1, 2026 are temporarily delayed, with no new date announced. The standardized assessment requirements are unaffected and stay in force.
- Final FY 2027 network and service rules may continue to evolve. Some MHP coverage expansions and PIHP network requirements remain forthcoming.
What changed since the April edition
Seven things. The first two have deadlines.
- Medicaid now enrolls limited licensed clinicians individually. Bulletin MMP 26-30-BH took effect September 1, 2026. Every LLPC, LLMSW, LLMFT and master's-level TLLP who bills Michigan Medicaid enrolls in CHAMPS as a Rendering Only provider with their own NPI, and that NPI goes on the claim. Full section below.
- November 1, 2026 deadline. Clinicians already enrolled under the old "Managed Care Only" label have until November 1 to report their supervisor's NPI and associate to them in CHAMPS. Miss it and the bulletin says disenrollment and claim denials follow.
- LLPCs can administer LOCUS and MichiCANS. The April edition listed this as unresolved. MDHHS's FAQ, updated June 4, 2026, lists "Licensed or Limited Licensed Professional Counselor" among qualified providers. Resolved.
- The age split is clearer. MichiCANS Screener for enrollees under 18. LOCUS for 18 and older. Most 18–20 year olds in MHP settings get the LOCUS. PIHP network providers use MichiCANS through 21.
- BH-COVER is delayed. MDHHS's Mental Health Framework page now states the coverage responsibility changes previously scheduled for October 1, 2026 are temporarily delayed, to allow more time for system-wide preparation. No replacement date has been announced. The LOCUS and MichiCANS requirements are not affected. Do not plan around an October 1 shift.
- Medicare's 2027 proposed rule is out. Counselors stay at 75% of the psychologist rate. Comments close September 14, 2026, docket CMS-1848-P at regulations.gov.
- Healthy Michigan Plan work requirements are coming. They start January 1, 2027 for adults 19 to 64. The test is 80 hours of approved activity, or about $580 in earnings, in at least one month of the review period, not every month. Approved activity includes paid or unpaid work, school, job training and volunteering. There are wide exemptions, including pregnancy, caring for a child 13 or under, medically frail status, substance use treatment and disability. Existing enrollees are first checked at renewals on or after March 1, 2027.
Executive Summary
The most significant change to Michigan's Medicaid behavioral health system since 1998
Primary Operational Risk: Private practice LPCs may lose their billing pathway for higher-acuity Medicaid patients when BH-COVER routes those patients to PIHP coverage. MDHHS has temporarily delayed this change and has not announced a new date. Most PIHPs do not contract with solo practitioners.
What Is the Mental Health Framework?
Under Michigan's Mental Health Framework (MHF), launched October 1, 2025 as part of the MIHealthyLife initiative, providers whose scope includes mental health assessment and who meet QMHP/CMHP criteria are required to use standardized assessment tools when assessing MHP-enrolled CHCP beneficiaries seeking mental health services:
LOCUS (Level of Care Utilization System) - for adults. Ages 18 and older. Most enrollees 18–20 in MHP settings receive the LOCUS.
MichiCANS Screener (Michigan Child and Adolescent Needs and Strengths) - for children and youth under 18. PIHP network providers use it through 21.
When BH-COVER takes effect (temporarily delayed, no new date announced), the assessment score, along with other factors including recent mental-health service utilization, will help determine whether an enrollee's care is covered by their MHP (lower acuity) or by a Prepaid Inpatient Health Plan/PIHP through the new "BH-COVER" benefit plan (higher acuity/specialty care).
Key Reassurance for FY 2026
MDHHS has indicated that providers will not be penalized for non-compliance during FY 2026 and that training status will not impact a provider's ability to provide and be reimbursed for non-assessment mental health services. The assessment rollout period runs through September 30, 2026. FY 2027 begins October 1, and MDHHS has not published what changes for providers who are still not assessing. MMHCA has asked.
Understanding the Acronyms
Michigan's behavioral health system uses many acronyms. Here's what they mean.
What This Means for Your Practice - Day to Day
How the Mental Health Framework changes your workflow with Medicaid patients
If You're an LPC in Private Practice
Here's what changes when you see a new Medicaid patient enrolled in a Medicaid Health Plan (MHP):
Before (Pre-October 2025)
- Patient calls, you verify Medicaid/MHP coverage
- You do your standard clinical intake and assessment
- You bill the MHP using standard CPT codes (90791, 90837, etc.)
- Treatment continues as long as medically necessary
Now (FY 2026 and Beyond)
- Patient calls - you verify Medicaid/MHP coverage (same as before)
- Check CHAMPS - does this patient already have a LOCUS or MichiCANS on file? If yes, you may not need to complete a new assessment
- Do your clinical intake - this doesn't change
- Complete the standardized assessment (new step):
- Adult (18+): LOCUS via mdhhs.locusonline.com
- Under 18: MichiCANS Screener via CC360
- Ages 18–20: most get the LOCUS in MHP settings. PIHP providers use MichiCANS through 21.
- Bill the assessment separately - H0031/WX for LOCUS, H0002/7Y for MichiCANS, in addition to your evaluation code
- Continue treatment - you don't have to wait for assessment completion to start treatment
- Once BH-COVER starts (delayed, no new date): If the patient scores 17 or higher on LOCUS, or Level 2 or 3 on MichiCANS, they qualify for BH-COVER assignment - meaning their coverage shifts to the PIHP, and you may lose your billing pathway unless you have a PIHP contract
If You're an LLPC (Limited License)
The same workflow applies, but with one critical addition:
Supervision requirement: LLPCs must practice under supervision of a fully licensed professional. Your supervisor should be aware of the MHF requirements and ensure your assessments meet QMHP standards. The assessment itself can be completed by an LLPC, but documentation and clinical decision-making should align with your supervision agreement and Medicaid Provider Manual requirements.
🟢 What Stays the Same
- Your clinical judgment drives treatment
- You bill your regular therapy codes (90837, etc.)
- Your relationship with mild-to-moderate patients continues
- You can start treatment before assessment is complete
- Assessment cannot be used to deny or limit services
- No penalties during FY 2026 for training delays
🔴 What Changes
- You must complete LOCUS or MichiCANS training
- You must administer assessments to new MHP patients
- You submit results to MDHHS (LOCUS) or CC360 (MichiCANS)
- You bill new codes for the assessment itself
- After Oct 2026: high-acuity patients may shift to PIHP
- If patient goes to PIHP, you need a PIHP contract to continue
The Key Question: What Happens to My Higher-Acuity Patients?
This is the central concern for private practice LPCs. If you have Medicaid patients who score 17 or higher on LOCUS, or Level 2 or 3 on MichiCANS, then once BH-COVER starts (currently delayed, no new date):
- They may be assigned to BH-COVER - meaning their mental health coverage moves from the MHP to the PIHP
- If you're not in the PIHP network, you cannot bill for their services
- Your options: (1) Seek a PIHP/CMHSP contract proactively, (2) request a single-case agreement, or (3) help the patient transition to a PIHP-network provider
- The system is not designed for this: PIHPs primarily contract with organizations, not solo LPCs - this is a gap MMHCA is actively advocating to close
Bottom Line for Private Practice
Complete LOCUS (~5 hrs) and/or MichiCANS (~7 hrs live) by Sept 2026
Which patients may meet higher-acuity thresholds?
Ask about contracting options before Oct 2026
MHF Assessment Decision Flowchart
When to assess, what happens after, and where patients go
Note: This flowchart shows the general decision pathway. BH-COVER assignment is based on meeting any one of the published criteria: LOCUS 17 or higher, MichiCANS Level 2 or 3, or enrollment in a listed 1915(c) waiver or the 1915(i) benefit. Recent service utilization was an additional route for initial assignment, not a required second factor. The start is temporarily delayed. Clinical judgment remains essential. Certain populations (1915(c) waiver, 1915(i) State Plan) are automatically assigned to BH-COVER regardless of score.
Understanding Assessment Results
How LOCUS and MichiCANS scores translate to coverage routing
LOCUS: 6 Dimensions → Composite Score → Level of Care
The LOCUS assesses adults across six dimensions, each rated 1–5:
| Dimension | What It Measures |
|---|---|
| 1. Risk of Harm | Danger to self or others, from minimal to extreme risk |
| 2. Functional Status | Ability to manage daily life, work, relationships |
| 3. Co-Morbidity | Medical, addictive, and psychiatric conditions occurring together |
| 4. Recovery Environment | Level of stress and support in living situation |
| 5. Treatment History | Past treatment engagement and response |
| 6. Engagement | Motivation for treatment and recovery status |
Dimensional scores are summed to produce a composite score that maps to one of six service levels:
| Level | Service Intensity | Composite Score Range | Coverage once BH-COVER starts |
|---|---|---|---|
| 1 | Recovery Maintenance / Health Management | 6–9 | MHP |
| 2 | Low Intensity Community-Based | 10–13 | MHP |
| 3 | High Intensity Community-Based | 14–16 | MHP |
| 4 | Medically Monitored Non-Residential | 17–19 | PIHP (BH-COVER) |
| 5 | Medically Monitored Residential | 20–23 | PIHP (BH-COVER) |
| 6 | Medically Managed Residential | 24–30 | PIHP (BH-COVER) |
Key threshold: Composite score of 17 or higher qualifies an adult enrollee for BH-COVER assignment (PIHP coverage) on its own, once BH-COVER takes effect. Recent service utilization was an additional route for initial assignment, not a required second factor. The start is temporarily delayed with no new date.
Note: Score ranges reflect standard LOCUS interpretation guidelines; MDHHS does not mandate fixed cutoffs, and clinical judgment remains required. The LOCUS is a clinical decision-support tool, not a rigid Medicaid eligibility determination.
MichiCANS Screener: 3-Level Decision Support Model
The MichiCANS Screener uses a Decision Support Model (DSM) that categorizes youth into three levels:
| Level | Classification | Routing | Coverage once BH-COVER starts |
|---|---|---|---|
| Level 1 | Mild/Moderate Level of Need | Referral to Appropriate Services | MHP |
| Level 2 | Severe/Serious Level of Need | Triggers Initial Assessment (full MichiCANS) | May → PIHP (BH-COVER) |
| Level 3 | Crisis | Move to Crisis Continuum of Care Services | PIHP (BH-COVER) |
Screener DSM criteria differ slightly by age group (0–5 vs. 6+). Full criteria available in MDHHS DSM documents. Level 2 triggers further assessment (full MichiCANS) and often leads to PIHP coverage, but assignment is not automatic - clinical judgment and additional factors apply.
LOCUS Assessment: Step-by-Step
For MHP-contracted private practice providers serving adults 18 and older
Complete Required Training
You cannot access the LOCUS submission portal until you have: (a) a National Provider Identifier (NPI), (b) active Medicaid enrollment (limited licensed clinicians now enroll individually; see MMP 26-30-BH), and (c) completed Michigan-specific LOCUS Basic Training. The training is self-paced online, approximately 5 hours, plus a certification exam. MDHHS pays for the training.
Log Into the MDHHS LOCUS Portal
Access the MDHHS-branded LOCUS Online platform. Log in using your authenticated email; an authentication code will be emailed to you. This is entry-only - you cannot retrieve or edit previously submitted assessments.
Complete and Submit the Assessment
Enter all required fields in one sitting. Save a PDF copy for your records BEFORE submitting - the portal does not permit viewing after submission. Submissions are transferred to MDHHS once daily. If there is an error, you must submit a new assessment.
Verify Results in CHAMPS
Beginning December 2025, aggregate LOCUS results and dates are visible in CHAMPS (Community Health Automated Medicaid Processing System), accessed via MILogin. Results post within 24 hours.
Bill for the Assessment
Use the procedure codes and modifiers specified in MMP 26-01 and the Standardized Assessment Guide. Bill the enrollee's MHP. The assessment can generally be billed in addition to the underlying clinical evaluation visit, subject to MHP billing rules.
LOCUS Score Interpretation
LOCUS results of 17 or higher are commonly used as a threshold for higher-acuity care needs. Once BH-COVER takes effect, this score on its own qualifies an adult enrollee for assignment to BH-COVER (PIHP coverage). Results below 17 generally keep the enrollee under MHP coverage.
MichiCANS Screener: Step-by-Step
For MHP-contracted private practice providers serving children and youth under 18 (through 21 in PIHP settings)
Complete Required Training (Two Live Sessions)
Unlike LOCUS, MichiCANS requires two live virtual sessions in this order:
- TCOM Orientation for Michigan Medicaid Health Plan Providers
- MichiCANS Overview for Michigan Medicaid Health Plan Providers
Each is held on preset dates/times and cannot be completed asynchronously. Combined duration: approximately 7 hours. Training is free and eligible for CME/CEU credit.
Pass the Certification Examination
Complete the vignette-based certification exam on the Praed Foundation TCOM platform. Certification is valid 12 months; annual recertification (vignette-based) is required.
Access CC360 via MILogin
MHP-contracted private practice providers receive a limited CC360 module specifically for the MichiCANS Screener. Access instructions are issued by MDHHS upon training completion.
Complete and Submit the Screener
Upon completion in CC360, MDHHS automatically pulls the result and date - no separate submission is required. Results post in CHAMPS within 24 hours.
Bill the MHP
Bill consistent with the Payment Responsibility Grid and MMP 26-01 codes.
Training Pathway Note
MHP-network private practice providers follow the registration instructions on the Mental Health Framework page. CMHSP/PIHP/CCBHC-employed providers use a different pathway via the Michigan Capacity Building Center (micbc.org). Make sure you're following the correct track for your employment situation.
Assessment Billing Codes
From MMP 26-01 - Bill to the enrollee's MHP
Required Codes and Modifiers
| Assessment | Procedure Code | Modifier |
|---|---|---|
| MichiCANS Screener (under 18) | H0002 | 7Y |
| LOCUS (18+) | H0031 | WX |
Source: MMP 26-01 (Final Bulletin). The assessment can generally be billed in addition to the underlying clinical evaluation visit, subject to MHP documentation requirements.
Assessment Timing
Treatment may occur while assessment is underway. The assessment does not have to be fully completed before services are rendered. The assessment may be completed across multiple visits.
Reassessment Schedule
Reassess at least every 12 months or sooner when clinically indicated. Reassessments may be conducted on clinical judgment without a defined "change in condition."
Do Not Assess During Crisis
Standardized assessments should not be completed during a behavioral health crisis or inpatient psychiatric admission. Wait until the enrollee is stabilized before administering LOCUS or MichiCANS.
Operational Essentials
Check CHAMPS First
Before completing a new assessment, check CHAMPS for an existing LOCUS or MichiCANS result to avoid duplication. Results are visible starting December 2025.
Who Must Assess
Applies to providers whose scope includes mental health assessment and who meet QMHP (Qualified Mental Health Professional) or CMHP (Child Mental Health Professional) criteria per Michigan Medicaid.
Billing Note
Assessment codes can generally be billed in addition to evaluation services, subject to MHP billing rules, bundling edits, and documentation requirements. Verify with your contracted MHP.
Document to Support Scores
Assessment scores should be supported by clinical documentation in the medical record. Assessment scoring patterns may be subject to payer audit for consistency with documentation.
LLPCs & Supervision
LLPCs may administer assessments consistent with supervision requirements under the Medicaid Provider Manual. Verify specific supervision documentation requirements with your MHP.
Where Problems Will Show Up
Most implementation challenges are expected at the MHP level (billing, authorization, CC360 access), not at MDHHS. Contact your MHP's provider relations for operational issues.
Medicaid enrollment for limited licensed clinicians
Bulletin MMP 26-30-BH. This is separate from the Mental Health Framework and separate from Blue Cross. It has the hardest deadline in this guide.
What the bulletin requires
Issued July 31, 2026, effective September 1, 2026. Every limited licensed behavioral health clinician who bills Michigan Medicaid, meaning LLPC, LLMSW, LLMFT and master's-level TLLP, now enrolls in CHAMPS on their own:
- Enroll as a Rendering Only provider with their own individual (Type 1) NPI.
- Associate to the organizational billing provider they work for (the clinic, group practice or employer).
- Report the individual NPI of their fully licensed supervisor on the enrollment checklist and associate to that supervisor in CHAMPS.
- On every professional claim on or after September 1, the limited licensed clinician's NPI goes in the Rendering Provider field. The supervisor no longer stands in for them on the claim.
The old "Managed Care Only" specialty label is being removed, so these enrollments will work for both fee-for-service and Medicaid Health Plan claims. Clinicians already enrolled under that label do not have to re-enroll, but they do have to add the supervisor association.
Deadline: November 1, 2026
Clinicians already enrolled have until November 1, 2026 to report and associate their supervisor in CHAMPS. The bulletin says the consequence is disenrollment and claim denials. There is no warning letter first. The draft policy said October 1; the final bulletin says November 1. Use November 1.
Six steps for a practice owner
- List every limited licensed clinician you employ.
- Confirm each one has their own Type 1 NPI. If not, apply at nppes.cms.hhs.gov. It's free and usually quick.
- Enroll each one in CHAMPS individually as Rendering Only, under their own name.
- Associate each one to their supervisor inside CHAMPS, with the supervisor's NPI.
- Tell your biller: the clinician's name and NPI go in the rendering provider field starting with September 1 dates of service.
- Run a test claim in September. Don't find out in December.
Hiring after November 1? The rule applies from day one. Start the CHAMPS enrollment when you make the offer, and don't schedule Medicaid clients with the new clinician until the supervisor association shows active. Whether CHAMPS will backdate an effective date for a pending enrollment is a question to put to MDHHS Provider Enrollment directly.
How Private Practice LPCs Can Seek PIHP Contracts
The realistic pathway - and its limitations
The Hard Truth
Michigan's PIHP/CMHSP system was designed around organizational providers - CMHSPs, agencies, residential facilities - not private practice clinicians. There is no standardized statewide application for solo LPCs to join a PIHP network. Each PIHP and its affiliated CMHSPs manage their own provider panels with varying policies, and most contract primarily with organizations, not individuals.
The Two Realistic Pathways
Option A: Contract with a CMHSP as a Subcontractor
CMHSPs (the 46 local Community Mental Health agencies) can and do subcontract with private practitioners for specific services. This is the most common pathway for LPCs.
How it works: You contract with your local CMHSP (not the PIHP directly). The CMHSP bills the PIHP; you bill the CMHSP. You follow CMHSP credentialing requirements, use their documentation systems, and accept their rates.
Option B: Single Case Agreement (SCA)
For a specific patient who moves to BH-COVER, you may be able to negotiate a single case agreement to continue treatment. This is patient-by-patient, not a general network contract.
How it works: You contact the patient's PIHP and request an SCA citing continuity of care. Approval is at the PIHP's discretion. Rates and terms vary. No guarantee of approval.
Step-by-Step: Approaching Your Local CMHSP
- Identify your local CMHSP(s) - Use the CMHAM directory at cmham.org/membership/cmhsp to find the CMHSP(s) serving your county
- Call their Provider Relations or Contracts office - Ask: "Do you contract with private practice LPCs for outpatient services? What is your application process?"
- Request their credentialing packet - Most CMHSPs have a provider application; some require RFP submission (see Macomb CMH example below)
- Ask about current needs - CMHSPs are more likely to contract for services they lack capacity in (child therapy, specific evidence-based treatments, bilingual providers, rural coverage)
- Understand the trade-offs - CMHSP rates are often lower than MHP rates; documentation requirements are heavier; you may need to use their EHR or submit encounter data in specific formats
What CMHSPs Look For
- Current Michigan LPC license (not LLPC, typically)
- Malpractice insurance ($1M–$3M per occurrence typical)
- NPI number enrolled in Michigan Medicaid
- Willingness to accept Medicaid rates
- Capacity to serve their geographic area
- Specialty skills they need (trauma, DBT, child/adolescent, SUD, etc.)
- Ability to meet their documentation/reporting requirements
Questions to Ask the CMHSP
- "Do you contract with individual practitioners or only agencies?"
- "What services are you currently seeking providers for?"
- "What are your reimbursement rates for outpatient therapy?"
- "Do I need to use your EHR, or can I use my own?"
- "What credentialing/background check requirements apply?"
- "Is there an RFP process, or can I apply directly?"
- "What is the typical timeline from application to contract?"
Example: Macomb County CMH Contracting Process
Macomb County CMH (MCCMH) is one of the few CMHSPs that publishes clear contracting guidance. Per their website:
"To become a contracted provider with MCCMH, organizations must be credentialed with MCCMH as well as utilize the competitive bid process via Request for Proposal (RFP) submission which includes an application, bidding process, procurement review and Board approval."
This suggests that even in CMHSPs with published processes, individual LPCs may face hurdles - the language references "organizations." Contact: providerrelations@mccmh.net (behavioral health) or review MCCMH Procurement Policy 3-020.
What MMHCA Is Advocating For
MMHCA is pushing for clear, published pathways for private practice LPCs to join PIHP networks - not just organizational providers. The current system's opacity disadvantages solo practitioners and limits patient choice. If you attempt to contract with a CMHSP or PIHP and encounter barriers, please document your experience and share it with MMHCA at MMHCABoard@MMHCAnow.org.
CMHSP Directory Quick Reference
Find your local CMHSP to inquire about provider contracting:
cmham.org/membership/cmhsp
cmham.org/membership/pihp
Michigan has 46 CMHSPs organized under 10 PIHPs. Your county determines which CMHSP serves your area. Some counties have multiple CMHSPs for different populations.
What PIHPs Actually Cover
Despite the name "Prepaid Inpatient Health Plan," PIHPs cover far more than inpatient services
The Full Scope of PIHP Services
The "Prepaid Inpatient Health Plan" name is a federal Medicaid managed-care designation, but in Michigan the 10 regional PIHPs administer the entire specialty behavioral health benefit:
| Currently PIHP-Covered | Population Served |
|---|---|
| All MH services for adults with SMI | Serious Mental Illness (adults) |
| All MH services for children with SED | Serious Emotional Disturbance (children) |
| Substance use disorder services (historically all) | SUD population* |
| All services for individuals with I/DD including 1915(c) waivers | Intellectual/Developmental Disabilities |
| Crisis services: emergency intervention, crisis residential, mobile crisis | All covered populations |
| Inpatient psychiatric for covered populations | SMI, SED, crisis |
| Habilitation, supported employment, ACT, peer support, targeted case management | All covered populations |
*Historically, all SUD services have been managed through PIHPs; future allocation may evolve under the MHF as service structures and contracts develop.
PIHPs operate by subcontracting with the 46 CMHSP authorities statewide and other downstream providers to deliver these services locally. MHPs currently cover physical health and only "mild-to-moderate" outpatient behavioral health.
When BH-COVER takes effect
MDHHS has indicated that MHPs will expand services for non-BH-COVER enrollees to include services like inpatient psychiatric care, crisis residential, partial hospitalization, and targeted case management. However, more specific service and network requirements are forthcoming - final rules have not been fully published.
The PIHP Reorganization & Court Ruling
What happened, what it means, and what's still moving forward
The 2025 RFP Controversy
In August 2025, MDHHS issued an RFP that would have:
- Reduced PIHP regions from 10 to 3 (Region A: Wayne/Oakland/Macomb; Region B: southern Lower Peninsula; Region C: UP + northern Lower Peninsula)
- Required full-region bidding, effectively meaning none of the 10 existing PIHPs could qualify
- Targeted October 1, 2026 implementation
- Affected $5–6 billion in state-administered Medicaid behavioral health funding
Critics argued this would privatize a system designed to be publicly governed, erode local CMHSP relationships, and potentially hand control to large private health plans.
MDHHS Issues RFP
Request for Proposals released to consolidate 10 PIHP regions to 3.
Lawsuit Filed
Six plaintiffs (Region 10 PIHP, Southwest Michigan Behavioral Health, Mid-State Health Network, and three county CMHSPs) sue in Michigan Court of Claims.
Partial Ruling for State
Judge Yates rules MDHHS has discretion to move to competitive procurement and reduce regions - but reserves judgment on specific RFP language.
Three-Day Evidentiary Hearing
Court hears evidence on whether specific RFP terms violate Michigan Mental Health Code.
Court Rules for Plaintiffs
Judge Yates holds the RFP "impermissibly conflicts with Michigan law in numerous respects," especially restrictions on CMHSP financial contracting.
MDHHS Withdraws RFP
Rather than amend or reissue, MDHHS rescinds the RFP. The existing 10-region PIHP structure remains in place. MDHHS says it will "evaluate next steps."
What the Withdrawal Does NOT Affect
The rescinded RFP applied only to PIHP regional restructuring. It did NOT halt:
- The October 1, 2025 standardized assessment requirement (LOCUS/MichiCANS)
- The BH-COVER benefit plan and MHP/PIHP payer routing, now temporarily delayed
- MHP expansion of services for non-BH-COVER enrollees
The Mental Health Framework remains on its scheduled timeline.
Continuity of Care Concerns
What happens when a patient's assessment indicates higher acuity?
The Private Practice LPC Risk
When BH-COVER takes effect (temporarily delayed, no new date announced), an enrollee who meets any one of the published criteria will be assigned to the BH-COVER benefit plan, meaning the PIHP becomes responsible for their mental health coverage.
Risk for Private Practice LPCs: A private-practice LPC contracted with the patient's MHP but not in the PIHP/CMHSP network may lose the MHP billing pathway for that patient unless the LPC obtains a contract or other authorization through the PIHP.
PIHPs historically contract almost exclusively with CMHSPs and CMHSP-affiliated providers. MDHHS acknowledges this may require PIHPs "to expand their mental health networks to include additional providers beyond CMHSPs" - but this expansion is not mandated, and there is no statewide guarantee that an MHP-contracted private practice LPC will be admitted to a PIHP network.
Practical impact: A Medicaid patient seeing you weekly for complex trauma who scores 17+ on LOCUS could be reassigned to PIHP coverage and may need to switch to a CMHSP-affiliated provider - potentially breaking a long-standing therapeutic relationship.
Guardrails MDHHS Has Established
MDHHS finalized policy states that standardized assessments:
- Should not be conducted during a crisis
- Cannot be used to determine, limit, or restrict the amount, scope, or duration of services
- May be reassessed on clinical judgment without a defined "change in condition"
However, these guardrails do not resolve the underlying network-access question for private practice providers.
Rural Access: The Upper Peninsula Challenge
Limited in-state capacity creates unique continuity concerns
Limited Inpatient Psychiatric Capacity
The Upper Peninsula presents acute geographic and capacity issues:
- Upper Peninsula Health Plan (UPHP) is the dominant MHP for the region
- NorthCare Network (Marquette) is the regional PIHP for all 15 U.P. counties
- The U.P. has very limited inpatient psychiatric capacity
- For many U.P. residents, inpatient stabilization happens across the Wisconsin border in Green Bay
Under the post-October 2026 framework, an MHP enrollee in the U.P. who screens into BH-COVER faces both the routing change and limited in-state inpatient capacity - raising concerns about cross-state transfers, family contact, and discharge continuity.
U.P. Regional Contacts
Cross-Border Resources
Pending Legislation Affecting Michigan LPCs and LLPCs
State and federal developments to monitor alongside MHF implementation
Resolved: LLPCs can administer LOCUS and MichiCANS
The April edition flagged this as open. MDHHS's Mental Health Framework FAQ, updated June 4, 2026, answers it: qualified providers include "Licensed or Limited Licensed Professional Counselor," alongside limited licensed social workers, psychologists and marriage and family therapists. A limited licensed clinician who has completed the required training and holds active Medicaid enrollment (now individual, see MMP 26-30-BH) may administer and submit both tools. Document supervision as you normally would.
Michigan: HB 4591 (Counseling Compact)
Other Michigan bills to watch
Track at: legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-4591
Federal: Medicare LPC/LMFT Reimbursement at 75%
Dual-Eligible Patients (Medicare + Medicaid)
Patients enrolled in both Medicare and Medicaid face overlapping systems. Under MHF:
- Primary coverage: Medicare typically pays first for covered services; Medicaid covers cost-sharing and services Medicare does not cover.
- MHF assessments: LOCUS/MichiCANS are Medicaid requirements. It is unclear whether dual-eligibles must be assessed for Medicaid purposes even when Medicare is the primary payer.
- BH-COVER assignment: If a dual-eligible patient scores into BH-COVER (PIHP), the coordination between Medicare billing and PIHP coverage becomes complex. MDHHS guidance on this population is limited.
- MI Health Link / MICH: Some dual-eligibles are enrolled in integrated plans (MI Health Link, or the newer MI Coordinated Health program). These have their own rules that may interact with MHF differently.
Bottom line: If you serve Medicare patients who also have Medicaid, watch for additional MDHHS guidance. The interaction between federal Medicare rules and Michigan's MHF is not yet fully clarified.
What You Can Do
- Track HB 4591: Contact your state senator to support Counseling Compact passage with rate-protection provisions.
- Submit CMS comments by September 14, 2026: regulations.gov, docket CMS-1848-P. Volume is counted. Say you're a Michigan counselor and ask for parity.
- Report ambiguities to MMHCA: If you encounter LLPC assessment questions, dual-eligible billing confusion, or other MHF gaps, document and share at MMHCABoard@MMHCAnow.org.
- Find your legislators: house.mi.gov/mhrpublic/frmFindaRep.aspx
What Other States Have Experienced
Lessons from similar carve-out and routing systems elsewhere
Published Research on Behavioral Health Carve-Outs
Michigan's PIHP carve-out is one of the longest-running specialty behavioral health managed care arrangements in the nation. Federal law generally prefers competitive procurement; Michigan obtained a federal waiver in 2002 to maintain its CMHSP-based system. Research from other states offers important lessons:
| State/Study | Findings |
|---|---|
| Tennessee - TennCare Partners (1996) NEJM 2002 |
Documented serious disruption of patient care, including reduced continuity of antipsychotic therapy among patients with severe mental illness. |
| Massachusetts - Medicaid carve-out Archives of General Psychiatry 1996 |
Reduced inpatient length of stay (22.5 to 17.8 days for SMI), but mixed quality outcomes. |
| Oregon - CCO comparison (2021) PMC study |
Behavioral health care use varied between carve-in and carve-out financing models, suggesting financing structure affects access patterns. |
| National literature Frank & Garfield, Annual Review of Public Health 2007 |
Carve-outs generally lowered costs and maintained or improved access, but quality results were mixed for severe mental illness. Interrupting patient–provider relationships in chronic illness populations risks patients "falling out of the system altogether." |
These findings underscore the continuity-of-care concerns raised by Michigan stakeholders about post–October 2026 patient routing.
Advocacy & Resources
How to advocate for your patients and stay informed
Document Clinical Necessity
MDHHS policy states standardized assessments alone cannot be used to determine, limit, or restrict the amount, scope, or duration of services. Other medical-necessity and Medicaid coverage rules still apply. Document thoroughly and contest any determination that limits services based solely on a score.
Seek PIHP Contracts Proactively
If you have Medicaid patients likely to score 17+ or Severe/Crisis, consider pursuing PIHP network contracts now. MDHHS anticipates network expansion.
File Complaints When Continuity Breaks
Report disruptions to the Medicaid Beneficiary Help Line, the patient's MHP, and MDHHS-MentalHlthFramework@michigan.gov.
Engage Professional Associations
MMHCA and NASW-Michigan are actively working with MDHHS on provider concerns. Your voice matters.
mmhcanow.org →Contact Your Legislator
Patient-specific testimony has influenced policy refinements. The January 2026 court ruling shifted the restructuring debate back to the Legislature.
Use Standard Consent Forms
Use Michigan's standard behavioral health consent form to exchange records and minimize duplicate assessments when a patient transitions.
Professional Associations
MDHHS Contacts
Complaints, Grievances & Appeals
If you or your patients experience access barriers, service denials, or continuity-of-care disruptions under the Mental Health Framework:
MDHHS Recipient Rights Hotline
1-800-854-9090
For CMH/PIHP service complaints
Medicaid Beneficiary Help Line
1-800-642-3195
General Medicaid enrollment/service issues
MDHHS Inspector General
MDHHS-InspectorGeneral@michigan.gov
Oversight and integrity concerns
DIFS Health Insurance Complaints
1-877-999-6442
michigan.gov/DIFS - insurance/health plan issues
State Fair Hearing Request
Michigan Office of Administrative Hearings & Rules (MOAHR)
For benefit denials after exhausting MHP/PIHP appeals
Disability Rights Michigan
drmich.org
Advocacy org - CMH rights resources
For MHP-specific grievances: Contact the enrollee's Medicaid Health Plan directly using the Member Services number on their ID card. Each MHP has its own grievance process.
Implementation Timeline
Where we are and what's coming
MIHealthyLife Initiative Launched
MDHHS begins stakeholder engagement (~10,000 stakeholders) on Mental Health Framework design.
FY 2026 Begins: Assessments Required
LOCUS and MichiCANS requirements take effect. LOCUS portal live. Training ramp-up period begins. No penalties for non-compliance during FY 2026.
CHAMPS Visibility
Aggregate LOCUS/MichiCANS results begin appearing in CHAMPS for cross-provider visibility.
Court Rules Against RFP
Judge Yates rules PIHP reorganization RFP conflicts with Michigan law. MDHHS withdraws RFP. 10-region PIHP structure remains.
Training & Preparation Period
Provider training continues. CC360 referrals module rolls out. MHP/PIHP plan readiness activities.
MMP 26-30-BH in effect
Limited licensed clinicians enroll in CHAMPS individually as Rendering Only and go on the claim by their own NPI. Details.
Medicare comments close
CY 2027 physician fee schedule, docket CMS-1848-P at regulations.gov.
FY 2026 ends. Healthy Michigan outreach begins.
Assessment rollout period closes. Work-requirement outreach to Healthy Michigan enrollees starts by this date.
BH-COVER start postponed
PIHP responsibility for higher-acuity enrollees was scheduled for October 1, 2026. MDHHS has temporarily delayed it for system-wide preparation and has not announced a new date. Assessment requirements are unaffected.
CHAMPS supervisor association due
Every currently enrolled limited licensed clinician must be associated to their supervisor in CHAMPS or face disenrollment and claim denials.
Healthy Michigan work requirement starts
80 hours of approved activity, or about $580 earned, in at least one month of the review period. Wide exemptions apply. Existing enrollees are first checked at renewals on or after March 1, 2027.
Blue Cross Phase 2 (commercial, not Medicaid)
BCBSM ends incident-to billing for limited licensed clinicians outside facility settings. Separate policy, separate fight. mmhcanow.org/bcbsm-impact
Michigan's 10 PIHP Regions
Contact your regional PIHP about network participation or single case agreements
| PIHP | Counties Covered | Contact |
|---|---|---|
| NorthCare Network | All 15 Upper Peninsula counties | 906-225-7217 northcarenetwork.org |
| Northern Michigan Regional Entity (NMRE) | Antrim, Charlevoix, Cheboygan, Emmet, Kalkaska, Otsego + 15 more northern LP counties | 231-487-9293 nmre.org |
| Region 10 PIHP | Genesee, Lapeer, Sanilac, St. Clair | 810-257-3705 region10pihp.org |
| Mid-State Health Network (MSHN) | Arenac, Bay, Clare, Clinton, Eaton, Gladwin, Gratiot, Hillsdale, Huron, Ingham, Ionia, Isabella, Jackson, Mecosta, Midland, Montcalm, Newaygo, Osceola, Saginaw, Shiawassee, Tuscola | 517-253-7525 midstatehealthnetwork.org |
| Lakeshore Regional Entity (LRE) | Allegan, Kent, Lake, Mason, Muskegon, Oceana, Ottawa | 616-389-8608 lsre.org |
| Southwest Michigan Behavioral Health (SWMBH) | Barry, Berrien, Branch, Calhoun, Cass, Kalamazoo, St. Joseph, Van Buren | 269-252-5700 swmbh.org |
| Community Mental Health Partnership of SE Michigan (CMHPSM) | Lenawee, Livingston, Monroe, Washtenaw | 734-544-3050 cmhpsm.org |
| Oakland Community Health Network (OCHN) | Oakland County | 248-858-1210 oaklandchn.org |
| Macomb County CMH | Macomb County | 586-948-0222 mccmh.net |
| Detroit Wayne Integrated Health Network (DWIHN) | Wayne County (including Detroit) | 313-833-2500 dwihn.org |
If you seek to continue treating a patient who moves to BH-COVER, contact the patient's regional PIHP about network credentialing or single case agreement options.
What MMHCA Is Doing - And What You Can Do
Collective advocacy from Michigan's LPCs is essential
MMHCA's Advocacy Priorities
MMHCA's Board and Education/Outreach Committee are actively engaged with MDHHS, NASW-Michigan, and legislative contacts on these unresolved issues:
- A new BH-COVER date - MDHHS has delayed the change without announcing a replacement date. MMHCA has asked for the revised timeline in writing.
- Continuity of care protections - Clear pathways for private practice LPCs to continue treating patients who move to BH-COVER
- PIHP network access - Formal requirements for PIHPs to credential private practice providers, not just CMHSPs
- Training burden relief - Reimbursement or offset for the 10–13 hours of non-billable training time
- CC360 access parity - Full functionality for private practice providers, not a limited afterthought module
- FY 2027 consequences clarity - Published rules for what happens if providers decline to perform assessments
- Rural access safeguards - Specific protections for UP and other areas with limited PIHP capacity
What You Can Do Now
- Enroll every limited licensed clinician in CHAMPS individually and link them to their supervisor before November 1, 2026. This is the one with a penalty.
- Join the MDHHS MHF Listserv - Stay informed on policy updates
- Document your experiences - Training access issues, CC360 problems, unanswered emails to MDHHS
- Share with MMHCA - Email MMHCABoard@MMHCAnow.org with your implementation stories
- Contact your state legislator - Especially if you practice in a rural area or have patients who may be affected
- Ask your PIHP about credentialing - Begin the conversation now. BH-COVER is delayed, not cancelled.
Key Listserv & Contacts
Strengthen Our Voice - Join MMHCA
MMHCA membership gives Michigan LPCs collective power in Lansing. Members receive regulatory updates, advocacy alerts, and direct access to policymakers shaping rules that affect your practice.
Not ready to join? Visit www.mmhcanow.org to learn more about MMHCA's work.
MMHCA Members: We Need Your Voice
If you experience access barriers, unanswered MDHHS emails, CC360 issues, or continuity-of-care disruptions, please report them to MMHCA. Real provider experiences shape legislative testimony and advocacy strategy. Your story matters.
Essential URLs & Documents
Bookmark these resources
MDHHS / State Resources
Submission Portals
Court Documents & News Coverage
Key Source Citations
The following MDHHS documents support key statements in this guide. We encourage providers to verify directly.
MHF FAQs (updated 6/04/26), p.3: "MDHHS understands that not all providers will be fully trained... anticipates that it will take time – over the course of FY 2026"
MHF FAQs (updated 6/04/26), p.4: Training completion affects ability to bill assessment codes only
Standardized Assessment Guide v1 (9/26/25), p.1: "Standardized assessments alone cannot be used to determine, limit, or restrict the amount, scope, or duration of services."
Standardized Assessment Guide v1 (9/26/25), p.2: "assessment may occur over more than one enrollee visit"
MMP 26-01 Final Bulletin (Behavioral Health): Procedure codes and modifiers for MichiCANS and LOCUS
MHF FAQs (updated 6/04/26), p.6: "Enrollees who are ages 18-20 must receive the MichiCANS Screener... may also receive the LOCUS"
Standardized Assessment Guide v1 (9/26/25), p.3: "should not be conducted during an inpatient psychiatric admission or crisis-related emergency"
Court of Claims Case No. 25-000143-MB (Judge Yates, 1/8/26); MHA announcement (1/2026)
MMP 26-01, Provider Qualifications section; Standardized Assessment Guide v1 (9/26/25)
Important: Implementation details may vary by Medicaid Health Plan (MHP), including billing edits, authorization requirements, and documentation expectations. Verify with your contracted MHP.
Full documents available at michigan.gov/mdhhs/mihealthylife/mental-health-framework. This guide was compiled April 30, 2026; policy may have evolved since publication.