The State of the Arizona Budget
by Pam Nenaber, CEO
As you are probably aware, one of the biggest challenges our state is currently facing has to do with the budget. There are very dramatic changes that affect how the state pays for low-income residents’ health care. In order to cover Arizona’s large deficit, Gov. Jan Brewer and other Arizona lawmakers approved a budget earlier this year that cut Arizona’s Medicaid program, also known as the Arizona Health Care Cost Containment System or AHCCCS. The current AHCCCS program covers 1.3 million people in Arizona. That is 20 percent of the entire population as well as 20 percent of the patients that we treat here at Banner Gateway.
The first change to this program came on May 1 when enrollment for the AHCCCS “spend down” program was frozen. This program covers people who normally would not qualify for AHCCCS, but who have sustained medical expenses that reduced their income to below 40 percent of the federal poverty level.
The next set of changes to the AHCCCS program will go into effect on July 1st. These changes include:
- The elimination of enrollment for childless adults.
- The elimination of enrollment for parents earning 100 percent of federal poverty level.
- The elimination of Federal Emergency Services (for non-qualified aliens).
- Current enrollees will be required to have eligibility redetermined in 6 months.
- There will be more mandatory co-payments.
- And there will be new benefit limits, such as for emergency room visits and inpatient days.
Then on Oct. 1st, there is yet another change. AHCCCS will cut the payments to health care providers by five percent. This reduction of payment is in addition to the previous deduction of five percent that occurred on April 1st.
Some of these changes are being challenged legally, however, we need to be prepared in case they all become effective. The savings to the Arizona state budget through these reductions to the AHCCCS program is over half a billion dollars for this fiscal year that begins on July 1. The impact to Banner Health as a whole may exceed 100 million dollars.
Regardless of these changes, we will continue to deliver the high level of excellent patient care that we are known for. Thank you for your continued hard work and dedication.