(The Center Square) – As Michigan Gov. Gretchen Whitmer prepares to sign the 2025-2026 fiscal year budget this week, the Michigan Department of Health and Human Services is gearing up to receive $30 billion in gross appropriations.
This comes despite growing concerns over a lack of transparency at the department.
In September, MDHHS Director Elizabeth Hertel testified under subpoena before the state House Oversight Committee.
The subpoena and hearing addressed ongoing concerns from Republican lawmakers related to the foster care system, welfare fraud, juvenile justice, and other issues under the department’s oversight.
During the hearing, State Rep. Jason Woolford, R-Howell, raised concerns about the department’s stewardship of its budget, which makes up a significant portion of the state’s overall budget.
“DHHS is entrusted with billions of taxpayer dollars, yet somehow can’t provide the essential services our residents rely on,” Woolford said. “That is absurd. This department must be held accountable for this unacceptable performance.”
Budget Cuts
In the 2025-2026 fiscal budget, MDHHS did see a significant cut in its funding from previous years.
In fiscal year 2024-2025, the department received $37.6 billion in funding. In the coming fiscal year, it will receive $30 billion. That is a 20% cut in a year. Part of that cut is due to the budget trimming more than 800 of the department’s full-time positions.
Despite that, Hertel still released a statement supporting the budget’s passage.
“I am pleased that the legislature has reached an agreement to pass a balanced, bipartisan state budget that will allow the dedicated staff of the Michigan Department of Health and Human Services to continue its vital work of protecting the health, safety and prosperity of Michigan families,” she said. “The passage of the FY 26 budget will enable us to sustain essential services for communities across Michigan including substance use disorder services, access to behavioral health services as well as vital Medicaid services and food assistance programs like SNAP that our friends, families and neighbors rely on every day.”
Policymakers’ Concerns
One of major concerns for lawmakers is the prospect of MDHHS paying the federal government at least $300 million in federal penalties because of its current error rate in the taxpayer-funded Supplemental Nutrition Assistance Program.
Currently, 1.5 million Michiganders are on the SNAP program.
A recent report from the USDA Food and Nutrition Service, Michigan had an error rate of 9.53% in fiscal year 2024. With the passage of the One Big, Beautiful Bill Act, states with an error rate of more than 10% will face federal fines.
While Michigan’s error rate is lower than the national average, lawmakers have said the error rate this year “soaring.” Republicans argue this is unacceptable.
“As a business owner, a 10% error rate would never fly,” said State Rep. William Bruck, R-Monroe, during September’s committee testimony. “Customers or shareholders would not put up with it, but somehow in government it’s accepted and there’s little accountability. That’s wrong.”
Other concerns include the department’s response to child welfare emergencies and placement and failing to protect the rights of mental health care patients in state care.
The latter comes following an independent investigation that was recently released by Michigan’s Office of Auditor General. That report found that nearly 30% of reports of alleged “abuse, neglect, serious injury, or death” were not investigated in a timely manner. This was just one of a number of issues raised by the report.
“The more we learn about Michigan’s inpatient psychiatric care, the worse it gets,” said state Sen. Michale Webber, R-Rochester Hills, in response to the report. “There is an immediate need for stronger oversight and accountability by this legislature for those at MDHHS who are charged with protecting our most vulnerable patients seeking psychiatric care.”
Republicans allege they have received minimal cooperation from Hertel or the department to address their growing concerns. Instead, they say salaries are growing at the department, while the quality of its services decline.
“There’s been nearly a 2,000% increase in the number of people at DHHS making over $100,000 in taxpayer-funded salaries since Director Hertel assumed her position,” said House Oversight Committee Chairman Jay DeBoyer, R-Clay. “It’s completely unacceptable to hear consistent instances where the department has allowed things to slip through the cracks. We must see more follow through from the department to assist our fellow community members, and we will continue to hold the department accountable to the people who help fund it.”
