Rural Health Care Funding

The Issue

Recognizing the importance of protecting rural health care access, the Michigan Legislature has set aside money from the State General Fund for Michigan’s rural hospitals, critical access hospitals, and hospitals that provide obstetrical services.  In addition, the legislature is considering increasing Medicaid reimbursements for outpatient services at all hospitals.  Unfortunately, after the Legislature passed the FY20 Budget that included these important sources of rural hospital funding, the Governor line-item vetoed (eliminated) them all.

The Impact

This funding is critical for our ability to continue providing world-class care, closest to home for the patients we serve in rural northern Michigan. As a result of these budget cuts, we are immediately faced with a loss of over $5 million dollars this fiscal year.  The specific impact on each of our hospitals is as follows:


FY20 General Fund Elimination
(Combined Rural/OB Payments)

Munson Medical Center


MHC Cadillac Hospital


MHC Grayling Hospital


MHC Otsego Memorial Hospital


MHC Manistee Hospital


MHC Charlevoix Hospital


Kalkaska Memorial Health Center


Mackinac Straits Health System


Paul Oliver Memorial Hospital


Munson Healthcare System Total        


Our Position

Munson Healthcare is asking the Legislature and Governor to agree on moving forward with budget supplemental bills that fund rural health care priorities including:  

  • SB 563 and HB 5062, which would restore the OB Stabilization pool,
  • SB 550 and HB 5063, which would restore the Rural Access pool,
  • SB 554 and HB 5064, which would provide an outpatient rate increase for critical access hospitals.

We also support funding a 7% Medicaid outpatient rate increase for all hospitals, even though this has not yet been introduced as a budget supplemental bill. It was, however, included in the budget that passed the House and Senate this fall.

What You Can Do: Act Now

Please call Senate Majority Leader Mike Shirkey, Speaker of the House Lee Chatfield, and Governor Gretchen Whitmer 

Senate Majority Leader Mike Shirkey
Phone:    (517) 373-5932


Speaker of the House Lee Chatfield
Phone:    (517) 373-2629


Governor Gretchen Whitmer
Phone:    (517) 373-3400

Ask that they:

  • Including funding in a supplemental appropriations bill for:
    • The OB Stabilization Pool
    • The Rural Access Pool
    • The Critical Access Hospital Pool
    • Medicaid Outpatient Rate Increase
  • It is critical that legislative leaders and the governor come to agreement and put their disagreements aside over issues like road funding or the State Administrative Board and pass a budget supplemental bill that funds rural health care 
  • Act now to prevent Munson Healthcare from losing over $5,000,000 in this current fiscal year alone
  • Restore this critical funding before these cuts impact our ability to provide healthcare to over 500,000 people in Northern Michigan