Michigan Lawmaker Examines Therapist Reimbursement Rates Amid Provider Exodus Concerns

The Michigan Legislature convened on September 3, 2025, to discuss critical issues surrounding health policy, particularly focusing on reimbursement rates for mental health services. The meeting highlighted concerns regarding the potential impact of House Bill 1234, which aims to facilitate telehealth services across state lines.

The discussion began with a presentation on the current reimbursement rates for psychotherapy sessions in Michigan, which average around $68 per session. In contrast, neighboring states such as Massachusetts and Colorado offer significantly higher rates, at $125 and $134 respectively. This disparity raises concerns that Michigan therapists may increasingly seek opportunities in states with better compensation, leading to a potential exodus of mental health providers from Michigan.

A key speaker emphasized that Michigan has some of the lowest reimbursement rates in the country, which has already resulted in many therapists ceasing to accept Medicaid patients due to inadequate compensation. The speaker urged lawmakers to reconsider the bill and to push for higher reimbursement rates from managed care providers, such as Meridian and McLaren, to retain therapists in the state.

Representative Mierman raised a question about whether the bill could serve as a revenue stream for Michigan counselors, allowing them to provide services while still earning competitive wages. However, concerns were voiced that if therapists begin to provide services in other states, Michigan would face an even greater shortage of mental health professionals.

The discussion also touched on the unique challenges faced by the Upper Peninsula (UP), where there is a significant shortage of healthcare professionals. Representative Preston suggested that the bill could help leverage therapists from Wisconsin to provide services in the UP, given the region's proximity to the state line. However, concerns were raised about the incentive for Wisconsin therapists to work in Michigan if reimbursement rates remain low.

The meeting concluded with a consensus that while the bill could offer some benefits, it is crucial to address the underlying issues of reimbursement rates and the shortage of therapists in Michigan. Lawmakers acknowledged the need for further discussion and potential modifications to the bill to ensure that it effectively supports both therapists and patients in the state.