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Background on the Section 298 Initiative

The Section 298 Initiative is an effort to improve the coordination of publicly-funded physical and behavioral health services in the state. The initiative began with the Governor’s 2016 executive budget, which sparked a statewide discussion on the best approach for integrating physical and behavioral health services. In order to facilitate this discussion, the Lieutenant Governor convened an initial meeting of stakeholders. This initial workgroup met five times during 2016 and produced a final report which included a set of “core values” and recommendations. 

The Michigan Legislature used the recommendations from the original 298 Workgroup to create Section 298, which was approved as part of Public Act 268 of 2016. Under this law, the Michigan Legislature directed the department to develop a set of recommendations regarding the most effective financing model and policies for behavioral health services for individuals with mental illnesses, intellectual and developmental disabilities and substance use disorders. 

The Department convened a new 298 Facilitation Workgroup, which hosted a series of Affinity Group meetings across Michigan to inform the development of the recommendations. 1,113 Michiganders participated in this process during 45 separate meetings. The Affinity Group meetings included individuals, families, providers, payers, and advocates. The department and the 298 Facilitation Workgroup used the input from these discussions to develop recommendations for two reports which were submitted to the Legislature. The first report was an interim report, which was submitted in January 2017 and focused on policy changes. The final report was submitted in March 2017 and included the initial policy recommendations and a new set of recommendations on financing models and benchmarks for implementation.

The Michigan Legislature then approved a revised version of Section 298 as part of Public Act 107 of 2017. Under the revised Section 298, the Legislature directed the department to develop and implement up to three pilots and one demonstration model to test the integration of physical and behavioral health services. The department was also instructed to (1) recruit a project facilitator to assist with the development and implementation of the pilots and (2) contract with one of the state’s research universities to complete an evaluation of the pilot(s) and demonstration model.  

In August 2017, the Department selected the Michigan Public Health Institute (MPHI) as the project facilitator. MPHI will be responsible for facilitating pilot and demonstration stakeholder discussions and managing the development and implementation process. 

In September 2017, the Department selected the Institute for Healthcare Policy and Innovation at the University of Michigan as the project evaluator. The project evaluator will work with the department to evaluate the pilot projects and demonstration model. The evaluation team will assist the department with (1) developing performance metrics and an evaluation plan and (2) conducting the evaluation of the pilot(s) and demonstration model. The evaluation shall include information on the pilot project’s and demonstration model’s performance on the identified metrics. The evaluation shall also include comparison sites to measure the performance of the pilots and demonstration model with the performance of the existing system.  The evaluation results will be used to assess the potential for replicating the pilot(s) and demonstration model in other parts of the state.

On March 9, 2018, MDHHS has announced the pilot sites for the Section 298 Initiative. MDHHS used a Request for Information (RFI) process in order to select the pilot sites. Based upon this process, MDHHS has selected the following three sites:

  • Pilot #1: Muskegon County CMH (dba HealthWest) and West Michigan Community Mental Health
  • Pilot #2: Genesee Health System
  • Pilot #3: Saginaw County Community Mental Health Authority


The Michigan legislature approved an updated version of the boilerplate language as part of Public Act 207 of 2018. The new boilerplate language directed the department to continue to implement the pilots and demonstration project but also added some new requirements.