House Appropriations Chair Rep. Ann Bollin today said a newly released audit of the Michigan Department of Health and Human Services’ oversight of the Michigan Public Health Institute (MPHI) raises serious concerns about transparency, accountability, and the state’s management of taxpayer resources.

The nonpartisan Office of the Auditor General identified significant deficiencies in MDHHS’s monitoring of MPHI agreements, including insufficient documentation, inadequate review procedures, reporting failures, and questions involving the approval of payments totaling hundreds of millions of dollars.

“For years, I have raised concerns about the scope of the state’s relationship with MPHI and whether sufficient safeguards exist to ensure transparency and accountability,” said Bollin, R-Brighton. “This audit confirms that major weaknesses exist in the department’s oversight practices and raises important questions about how taxpayer dollars are being monitored.”

The audit found MDHHS frequently could not document information it reviewed when approving project budgets, financial reports, and work plans. Auditors also reported that nearly 70% of the financial status reports reviewed lacked supporting cost documentation and that the department paid approximately $108 million before receiving or reviewing documentation validating project work.

In addition, auditors found that MPHI affiliate staff and MDHHS employees previously employed by MPHI approved nearly half of the financial status reports reviewed for payment, representing approximately $199 million in payments to the organization.

“Oversight procedures designed to protect taxpayers are not being followed,” Bollin said. “This is very concerning because every dollar should be supported by proper documentation, appropriate review, and clear accountability.”

The audit also found MDHHS improperly approved certain indirect costs at a higher reimbursement rate than authorized and repeatedly failed to provide the Legislature with information required under state reporting requirements. According to auditors, some semiannual reports omitted required project and funding information, and none of the projects reviewed included all reports, studies, and publications required to be reported to the Legislature.

“The Legislature cannot provide meaningful oversight when required information is incomplete or unavailable,” Bollin said. “We need to have a transparent process that allows both legislators and the public to understand how funds are being spent and whether state agencies are complying with established requirements.”

Earlier this year, the House Appropriations Committee held a hearing to better understand the scope of the partnership between MDHHS and MPHI, including the services MPHI performs on behalf of the department and the oversight mechanisms in place to ensure accountability. She then turned the issue over to the House Oversight Committee to look further into the concerns.

Bollin said the audit findings reinforce the importance of continued legislative scrutiny and transparency. She also emphasized the importance of implementing corrective actions to strengthen oversight moving forward.

“I appreciate the work of the Office of the Auditor General in conducting this review,” Bollin said. “I will be closely examining both the findings and the department’s response. The goal should be greater transparency, stronger accountability, and renewed confidence that taxpayer dollars are being managed responsibly.”