The Value Curve in Action

Serving All Citizens: Driving System Integration in Michigan

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On January 1, 2015, recently reelected Michigan Governor Rick Snyder ascended the steps of the state capitol, took the oath of office, and delivered an inaugural address with a stirring vision. More concretely, he argued that the state needed to reorient its approach to social services. “We’ve tried to solve problems by creating new programs, segmenting programs, and adding layers of government,” he explained. “Each program focuses on a finite segment of someone’s life without looking at the whole person and understanding what’s holding them back from success.”

In February, Snyder complemented his rhetoric with action, signing an executive order to combine the Departments of Community Health and Human Services. With more than 14,000 employees and a $25.1 billion budget, the newly created Department of Health and Human Services (DHHS) would be the largest agency in the state. It also evoked the change Snyder hoped to effect statewide. “This restructuring is not just about putting two departments together,” he emphasized. “It’s looking at a fundamentally better way of service…. Let’s treat people as people, not programs.”

Put differently, Snyder wanted Michigan to ascend the Human Services Value Curve. The state had long had a regulative business model, with programs operating in silos and minimal integration of data, IT, and budgets. State officials wanted to create an integrative or generative business model in which programs focused on the whole person and the state leveraged data and shared information to react nimbly to novel challenges. To Timothy Becker, the chief deputy director of DHHS, effecting this transition was imperative. “We’re pretty good at running programs,” he lamented. “We’re not real good at addressing the core needs of the people that we serve.”

To achieve their goals, Snyder, Becker, and other state officials would have to bind together approximately 140 different programs and in the process, answer a number of vexing questions. Who were the highest-need clients? What should an integrated service delivery system look like? How could they free social workers to focus on clients? Could they overcome challenges—ranging from the cacophony of daily governance to cross-agency culture clashes—to sustain the momentum for reform?

Background – The Impetus to Merge: 2013 – April 2015

A CPA by trade, Snyder had prioritized efficiency and impact since taking office in 2011. However, he and other state leaders did not begin to see the benefits of having the community health and human services agencies work together until 2013 when Michigan applied to become a Medicaid expansion state. The application process and subsequent expansion were, as Becker recalled, an “aha moment” that revealed the poor coordination between the two agencies in the status quo, as well as the potential synergies when they worked together., For example, auditing the state’s Medicaid program had been exceptionally difficult because the Department of Community Health oversaw part of Medicaid, the Department of Human Services handled Medicaid eligibility, and the agencies had been, as Becker said, “tripping over each other.” But the Medicaid expansion provided the beginnings of a coordination mechanism.

Then, in 2014, the directors of both agencies announced their plans to retire, prompting state officials to consider the possibility of consolidating the two organizations. Snyder initiated a dialogue about a merger, culminating with his executive order in February 2015 and the formal consolidation of the agencies in April 2015.

Implementation Questions and Challenges: May – December 2015

Although bringing the agencies together was a crucial first step, the department’s new leaders had to figure out how to make Snyder’s vision a reality. Officials began by crafting a diagram mapping the program’s clients and their needs. The exercise was revealing. Of the (approximately) 2.3 million Medicaid recipients in Michigan, 909,000 citizens also received food assistance, and 60,000 people obtained Medicaid as well as cash and food assistance. The agency had identified some of the state’s highest-need citizens and, as Becker said, now needed to “get at the core of their issues that are bringing them in our doors.”

The best way to identify these “root causes” was to put different programs in dialogue with one another, but with 140 programs accustomed to operating in silos, this was a formidable task. For one thing, the existing IT infrastructure had developed around Medicaid, so IT staff knew a lot about that program and little about others. This meant that disseminating program data—which was similarly segmented in different warehouses—would require retraining IT staff and crafting a system that transcends boundaries. “I wanted to take that [expertise] out and spread it horizontally across the organization where they can drive the change we’re talking about,” Becker explained, “and mak[e] sure that we’re cutting across the administrations and not just staying in the silo[s].”

The Path Ahead: 2016 and Beyond

A little over eight months into the merger, DHHS has encountered multiple challenges, ranging from staff turnover to the difficulty of meshing the cultures of the health and human services staffs. To Becker, these difficulties, although painful in the short-term, will lead to unity in the long term. “To make this work,” he said, “everybody’s got to be rowing in the same direction.”
What’s more, even as the agency wrestles with these short-term obstacles, it is starting to put programs in dialogue with one another, beginning the process of ascending the Human Services Value Curve. “I think overall with the merger, and now that we’ve been able to synchronize, we’ve got different administrations talking to each other,” Becker said. “Overall, I believe we [have] a collaborative/integrative [business model].”

If the agency is to realize its ultimate goal of developing an integrative or generative business model, it will have to sustain what Becker identifies as the most integral aspect of the reform effort: taking time to think about the clients the agency is serving. “What I continue to emphasize with our folks,” said Becker, who often meets and schedules multi-day retreats with local officials, “…is let’s all take our head[s] up for a few seconds, let’s look around, let’s talk to other people in the department and let’s figure out how we can better serve the people that we’re serving.” And it is because of this focus that Becker is confident that DHHS can overcome years of fragmentation and contribute to the governor’s vision. “We’re not quite where we want to be yet,” he acknowledged, “but I think we’re getting there.”