In this special edition, We review the Michigan Court of Claim’s decision in Region 10 PIHP v State of Michigan. Pull Up Your Chair & Let’s Start the Conversation.
Rebid
The Michigan Court of Claims has ruled that the Michigan Department of Health and Human Services (MDHHS) acted within its authority to overhaul the state’s public behavioral health system, but left the case open to address whether parts of the state’s 2025 Request for Proposals (RFP) conflict with Michigan law.
In a decision issued Tuesday October 14, 2025, Judge Christopher Yates upheld the state’s ability to shift from a single-source procurement model to a competitive bidding process and to reduce the number of Prepaid Inpatient Health Plan (PIHP) regions from ten to three. The court granted summary disposition to the state on those issues, concluding that MDHHS has discretion under state and federal law to redesign the system.
However, Yates declined to dismiss the case entirely, noting that the RFP’s specific terms “may run afoul of Michigan law in important respects.” The court cited provisions that assign certain non-delegable managed care functions to PIHPs, which could interfere with statutory responsibilities reserved for Community Mental Health Service Programs (CMHSPs).
The ruling allows MDHHS and the Department of Technology, Management and Budget (DTMB) to continue evaluating proposals under the new three-region structure scheduled to begin October 1, 2026. At the same time, the plaintiffs — several current PIHPs and CMHSPs — may continue challenging the legality of the RFP and its potential impact on local mental health authorities.
Judge Yates said the plaintiffs’ motion for a preliminary injunction will be decided in a separate opinion, and the order is not final because it does not resolve all pending claims.
You can read the opinion in Court of Claims 25-000143-MB Region 10 PIHP v State of Michigan, here.
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