Laws 1981, Fourth Special Session, Chapter 1, effective February 8, 1982 established the Arizona Health Care Cost Containment System. Statutory authority is found at A.R.S. §§36-2901 through 36-2999.
Medicaid is a federal healthcare program for low-income individuals and families.
AHCCCS administers Arizona’s Medicaid program, which provides health insurance for low-income Arizonans based on eligibility criteria outlined in statute. AHCCCS is governed by federal and state requirements and is jointly funded by federal, state and county government monies. The federal Medicaid program allows each state to administer its own program. AHCCCS operates according to a federal waiver and contracts with health plans to provide primary, acute and long-term care services to eligible recipients. AHCCCS oversees programs for acute care, long term care, behavioral health and children’s care, and is responsible for determining eligibility and enrollment; monitoring quality of care; executing contracts with health plans and providers; and procuring services.
Title XIX of the Social Security Act in 1965 created the federal Medicaid program to provide health care for low-income individuals and families who meet certain eligibility requirements. The program is jointly funded by the federal and state governments. Arizona did not initially participate in the federal program and county governments were responsible for the costs of health care for the poor. AHCCCS, established in 1982 as an alternative to Medicaid, provides medical services to eligible persons through a managed care system. AHCCCS was the first statewide Medicaid managed care system in the U.S. AHCCCS contracts with a number of public and private entities to provide services. The providers receive a fixed monthly amount, or capitation payment, for each enrolled member. Initially, AHCCCS covered only acute care, however additional programs have been implemented since 1982. The Arizona Long Term Care System (ALTCS) was put in place in 1987 to provide long term care for the elderly, physically disabled and developmentally disabled. In 1990, AHCCCS phased in mental health services and behavioral health coverage in response to federal requirements. Children under age 19 receive medical services under Arizona’s Children’s Health Insurance Program, adopted in 1998. Legislation has also been enacted to address comprehensive care for the elderly and nursing facility provider assessments. The number of recipients has varied over time, impacted by available funding and modifications to eligibility requirements.
Laws 1981, Fourth Special Session, Chapter 1 established AHCCCS as a division within the Arizona Department of Health Services (ADHS). It provided for hospitalization and medical care of the indigent sick; provided funding for the system; authorized the director to apply for federal funding; outlined responsibilities of counties, the Arizona Department of Economic Security (ADES) and the ADHS; prescribed requirements for eligibility, services, coverage and contracts; and executed prepaid capitated health service contracts. Coverage was required to begin October 1, 1982.
Laws 1983, Chapter 304 modified AHCCCS legislation to clarify state and county responsibilities related to indigent health care coverage. The measure specifically addressed ADHS authority, eligibility, coverage, reimbursable services and costs to counties. The Arizona Auditor General was required to determine if changes in county responsibilities related to indigent health care had resulted in a shift of costs to or from any county. The report was due by April 1, 1984 to the Governor, Legislature, and the Joint Legislative Budget Committee.
Laws 1984, Chapter 372 established AHCCCS as a stand-alone agency and transferred responsibilities, personnel, equipment and funds from ADHS to the newly created agency.
Laws 1986, Chapter 380 was an omnibus measure addressing eligibility, coverage, county contributions and penalties. The measure also expanded coverage to eligible children less than six years of age and included a supplemental appropriation of $3.8 million for fiscal year 1986-1987 to cover operating and medical service expenditures.
Laws 1987, Chapter 332 established the Arizona Long Term Care System (ALTCS) in order to provide long term care for the elderly, physically disabled and developmentally disabled.
Laws 1989, Chapter 5 prescribed eligibility determinations, enrollment and coverage for qualified Medicare beneficiaries in accordance with the federal amendments to Title XIX of the Social Security Act and Title III of the Medicare Catastrophic Coverage Act of 1988.
Laws 1990, Chapter 334 phased in mental health services and behavioral health coverage in response to federal requirements. The measure provided for mental health services for children under age18, including screening, diagnostic and treatment services. AHCCCS was required to phase in implementation as of October 1, 1990 and to deliver services to all eligible persons by April 1, 1991. A report on implementation of mental health services, including recommendations on the delivery system, was due to the Governor, the Legislature, AHCCCS, ADHS, ADES, the Arizona Department of Corrections, the Arizona Department of Education and the Arizona Supreme Court by December 31, 1991.
Laws 1998, Fourth Special Session, Chapter 4 established the Children’s Health Insurance Program (CHIP), which is a federal program administered by the states to provide health insurance to children from low-income families. Arizona’s CHIP program covers children up to age 19 and is jointly funded by federal and state governments at a 3 to 1 matching rate. Tobacco tax monies were dedicated to provide the state matching monies. A cap could be imposed on enrollment if the program exceeded the available funding. In the event federal monies were unavailable, the program would be repealed and services would be terminated. Note: the CHIP program was repealed in 2010 as part of the state budget, but was reinstated that same year by Laws 2010, Chapter 232.
In 2000, Arizona voters approved Proposition 204, a measure that expanded AHCCCS coverage to individuals with income at or below 100 percent of the federal poverty level. The ballot measure dedicated settlement monies received as a result of a lawsuit filed against manufacturers of tobacco products as the source of funding to cover the costs of expansion. Arizona’s share of the settlement monies was estimated at $3.2 billion over a 25-year period. Prior to passage of Proposition 204, AHCCCS recipient’s net income could not exceed 34 percent of the federal poverty level.
Laws 2006, Chapter 307 established a program for comprehensive care for the elderly as an alternate model for ALTCS members who meet specified requirements.
Laws 2011, Chapter 31 made a number of changes to AHCCCS regarding eligibility, cost sharing, provider rates and hospital reimbursement, county contributions, prescription drugs, fraudulent payments, and transplant services. The measure also transferred responsibility for the children’s rehabilitative services program from ADHS to AHCCCS.
Federal law allows states to impose an assessment on specified providers for health care items and services in order to receive federal matching funds. Laws 2012, Chapter 213 established an assessment on health care items and services provided in nursing care facilities in order to draw down federal monies to supplement Medicaid payments.
Laws 2013, First Special Session, Chapter 10 made a number of changes to AHCCCS regarding Medicaid expansion, hospital assessments, ambulance services, payments to hospitals, county contributions, and Medicare waivers.
Laws 2015, Chapter 195 transferred the administration of behavioral health services from ADHS to AHCCCS.
Arizona Revised Statutes §§36-2901 through 36-2999
Laws 1981, Fourth Special Session, Chapter 1
Laws 1983, Chapter 304
Laws 1984, Chapter 372
Laws 1986, Chapter 380
Laws 1987, Chapter 332
Laws 1989, Chapter 5
Laws 1990, Chapter 334
Laws 1998, Fourth Special Session, Chapter 4
Laws 2006, Chapter 307
Laws 2010, Chapter 232
Laws 2011, Chapter 31
Laws 2012, Chapter 213
Laws 2013, First Special Session, Chapter 10
Laws 2015, Chapter 195
AHCCCS Performance Audit, No. 12-07. September 2012. Arizona Auditor General Office www.azauditor.gov
AHCCCS website: http://www.azahcccs.gov
Health Care Under AHCCCS: an examination of Arizona’s alternative to Medicaid. Howard E. Freeman and Bradford Kirkman-Liff
Master List of State Government Programs, January 2015. Governor’s Office of Strategic Planning and Budgeting (OSPB). http://www.ospb.state.az.us
Proposition 204, Ballot measure approved November 4, 2000. See apps.azsos.gov/election/2000/Info/pubpamphlet/english/prop204