Arizona Medicaid History and Facts

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Initial Medicaid Implementation: Arizona was the last state to take up the Medicaid program initially, beginning their program in October of 1982, 17 years after the passage of the law. Prior to accepting the Medicaid program, Arizona had a county-based system for providing care to low-income residents. This meant that the services available to low-income Arizonans varied greatly based on where they lived. The Medicaid program’s name the Arizona Health Care Cost Containment System (AHCCCS) illustrates the state’s early goals for the program. The state held out in part until they were able to secure the ability to implement their Medicaid program through managed care contracts. The state became the first and only state to run their Medicaid program entirely through capitated arrangements with contracted health plans. Today a small portion of beneficiaries, primarily elderly and disabled individuals requiring long-term care, obtain coverage outside of the managed care plans.

Key Medicaid Political Issues: Initially, the state only covered acute care services. In 1987 they began covering long-term care through a separate program called ALTCS. In the 1980s the state adopted expansions to the AHCCCS program to pregnant women and children and defund organ transplants. In the last few years, the state has had some unique policy debates surrounding the funding of the state’s Children’s Health Insurance Program. In 2010 the state froze enrollment in the KidsCare program and in 2014 discontinued the program. For two years the state was the only state without CHIP and the only state to discontinue a CHIP or other eligibility category of Medicaid. 

Medicaid expansion Implementation: Then governor Jan Brewer became one of the first Republican governors to accept the Medicaid expansion. The legislature passed the Medicaid expansion appropriation by a simple majority. Following the expansion, the legislature worked to sue the administration to end the expansion. The Arizona Supreme Court eventually struck down the lawsuit in 2017. The suit was centered on the fact that the state legislature did not pass the expansion with a 2/3rd majority that is required for to levy a tax on providers. The state applied for a Section 1115 waiver in August 2015. The program requires that enrollees earning more than the poverty level pay premiums into a health savings account or participate in wellness programs and offers an optional job search program. In 2018 the state has submitted a work requirement waiver to CMS which included several policies that were previously rejected by the Obama administration including a 6 month lockout period for non-payment, a 5 years lifetime limit on Medicaid coverage, 6 month redeterminations of coverage.

General facts about Arizona Medicaid:

Medicaid program name: Arizona Health Care Cost Containment System (AHCCCS)

CHIP Program name: KidsCare

Separate or combined CHIP: Separate CHIP

Enrollment: 1,700,000 (2017)

Total Medicaid Spending: $11.1 billion (2016)

Share of total population covered by Medicaid: 25.4% (estimate)

Share of Children covered by Medicaid: 50% (estimate)

Share of Medicaid that is Children and Adults: 81%

Share of Spending on Elderly and people with disabilities: 50%

Share of Nursing Facility Residents covered by Medicaid: 60% (estimate)

FMAP: 69.2%

Expansion state: Yes

Number of people in expansion: 418,400 (2016)

Work Requirement: Submitted

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