The Michigan Medicaid fee schedule is the list of dollar amounts the state pays for each covered service delivered to a Medicaid beneficiary, organized by CPT and HCPCS billing code. Across 40 commonly billed codes, Michigan Medicaid pays an average of 72.8% of the Medicare rate. The most significant recent changes came in 2024: an approximately 33% increase in behavioral health reimbursement and a raise in the children’s vaccine administration fee to $23.03 per dose. Because roughly 97.8% of Michigan’s 2.4 million Medicaid enrollees are in managed care, the published schedule often functions as a benchmark rather than the exact rate a provider receives.
How the Schedule Is Built
The Michigan Department of Health and Human Services (MDHHS) organizes the fee schedule by service category: physician visits, inpatient and outpatient hospital care, long-term care, lab work, and so on. Each covered service maps to a billing code with a specific reimbursement rate attached.
Those rates are built from relative value units (RVUs), which quantify the resources a service requires. Every RVU has three components: the physician’s work, the practice expense (overhead, staff, supplies), and malpractice insurance cost. Each component is adjusted by a geographic cost index, then multiplied by a conversion factor to produce a dollar amount. When MDHHS changes the conversion factor or updates the underlying RVU weights, reimbursement rates shift across the board.
MDHHS updates its fee schedule databases at least annually, and sometimes more often when mid-year policy changes take effect. Current and recent schedules are available through the MDHHS billing and reimbursement pages, with a three-year archive online. Older schedules require a Freedom of Information Act request.1State of Michigan. Information Specific to Different Providers
Where Michigan Rates Sit Compared to Medicare
Across 40 commonly billed CPT codes, Michigan Medicaid reimburses an average of 72.8% of what Medicare pays. Strip out five codes tied to enhanced payment policies for children’s vaccines, pediatric mental health assessments, and maternity care, and the average drops to 69.4% of Medicare.2State of Michigan Department of Health and Human Services. Medicaid Reimbursement Rates Report (FY2025 Appropriation Act – Public Act 121 of 2024) A practice relying heavily on Medicaid patients collects roughly 30 cents less per dollar of service than it would at Medicare rates.
2024 Rate Changes
The FY2025 appropriation, Public Act 121 of 2024, funded several targeted rate increases that took effect during 2024 and into 2025.
Behavioral Health
Michigan allocated $36.1 million to raise Medicaid behavioral health reimbursement rates by approximately 33%, covering both managed care health plans and fee-for-service claims. The increase applied broadly across provider types delivering behavioral health care, not only psychiatrists. Separately, autism behavioral technician hourly rates were raised, with funding to support rates up to $62.00 per hour.3Michigan Legislature. House Fiscal Agency Analysis – House Bill 5556 (H-2) as Amended
For many behavioral health practices, the change was practical, not just financial. Before this increase, providers had effectively capped their Medicaid caseloads because the math didn’t work. A 33% rate increase changes whether a practice can afford to hire additional clinicians, extend evening hours, or accept new Medicaid patients at all.
Children’s Vaccine Administration
Effective August 2024, MDHHS increased the reimbursement for vaccine administration codes to $23.03 per dose when the patient is under 19 years old. The change covered CPT codes 90460, 90471 through 90474, 96380 through 96381, and HCPCS codes G0008 through G0010, along with any future covered vaccine administration codes.4State of Michigan. MMP Bulletin 24-39 For pediatric practices and family medicine offices, the increase helps offset the overhead of stocking and administering vaccines that were previously reimbursed below cost. Even so, $23.03 per dose still lags behind what commercial insurers pay.
Orthopedics and Other Targeted Funding
The budget directed additional funds toward orthopedic services, with the goal of bringing select Medicaid orthopedic codes to approximately 74% of comparable Medicare rates. Federally Qualified Health Centers received $40 million in funding related to Medicaid scope changes, and $2.3 million supported the 988 Suicide and Crisis Lifeline (Michigan Crisis and Access Line) to backfill reduced federal grant funding.3Michigan Legislature. House Fiscal Agency Analysis – House Bill 5556 (H-2) as Amended Traditional Medicaid saw a $360.2 million gross increase for caseload, utilization, and inflation adjustments.
Telehealth Pays the Same as In-Person
Michigan requires MDHHS to reimburse telehealth services at the same rate as equivalent face-to-face visits, specifically the non-facility component of the reimbursement rate. This is parity, not a bonus. A telehealth appointment pays the same as an in-person one, not more.3Michigan Legislature. House Fiscal Agency Analysis – House Bill 5556 (H-2) as Amended The practical effect is that providers don’t face a financial penalty for delivering care virtually.
For rural Michigan, where patients may travel significant distances to reach a provider, telehealth parity matters more. Rural obstetric providers, for example, often can’t offer labor and delivery locally but can provide prenatal care and postpartum follow-up without absorbing a rate cut for virtual visits.2State of Michigan Department of Health and Human Services. Medicaid Reimbursement Rates Report (FY2025 Appropriation Act – Public Act 121 of 2024)
Why the Published Rate Isn’t Always Your Rate
The fee schedule sets rates for fee-for-service (FFS) Medicaid, where the state pays providers directly for each covered service. As of mid-2024, about 97.8% of Michigan’s 2.4 million Medicaid enrollees were in some form of managed care.5Centers for Medicare & Medicaid Services. Medicaid Managed Care Enrollment and Program Characteristics Report Under managed care, the state pays a Managed Care Organization (MCO) a fixed monthly amount per enrollee, and the MCO negotiates its own payment rates with providers.
So the published fee schedule is not the rate most providers actually receive. MCO-negotiated rates may be higher or lower than the FFS schedule depending on the provider’s leverage, specialty, and contract terms. The schedule still functions as a benchmark; MCO contracts frequently reference it as a floor or starting point.
The Specialty Network Access Fee
Michigan operates a directed payment program called the Specialty Network Access Fee (SNAF), which channels enhanced Medicaid reimbursement up to the average commercial rate for participating practitioners who serve managed care enrollees.6Centers for Medicare & Medicaid Services. Michigan Fee-for-Service Amendment The SNAF program effectively narrows the gap between Medicaid and commercial insurance payments for eligible providers.
Rural Billing: A Structural Wrinkle
Rural providers face a compounding problem: lower patient volume spread across the same fixed costs. Michigan’s Medicaid reimbursement report highlighted that rural obstetric providers are less likely to bill for global obstetric bundles or postpartum bundles because local hospitals have discontinued labor and delivery services.2State of Michigan Department of Health and Human Services. Medicaid Reimbursement Rates Report (FY2025 Appropriation Act – Public Act 121 of 2024) What would otherwise be a single bundled payment fragments into lower-value individual claims. Enhanced rates for certain rural services and the SNAF program help, but they don’t fully offset the structural disadvantage of practicing in a low-volume setting.
Keeping Billing Aligned With Rate Changes
Every rate update creates back-office work. Billing departments need to verify that their practice management software reflects the new rates, update fee schedules in their systems, and confirm that managed care contracts incorporate any passthrough increases. Providers who bill for behavioral health, pediatric vaccines, and orthopedic services simultaneously faced multiple overlapping updates in 2024. Submitting claims at old rates results in underpayment; submitting at rates that don’t match the service date can trigger audit flags. Practices without dedicated billing staff, common in small and solo operations, often discover rate changes only when claims are denied or underpaid.