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Feds approve some of Medicaid cuts requested by Arizona

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Feds approve some of Medicaid cuts requested by Arizona

The federal government Friday approved limited benefit changes in Arizona’s Medicaid program, but rejected $52 million in savings that state officials said budget shortfalls had forced them to propose.

The Centers for Medicare and Medicaid Services (CMS) approved the state’s requests to impose limited copayments on non-emergency medical transportation and to charge fees for missed medical appointments for many adults in Arizona. Those changes are expected to save $2.7 million.

But the federal agency denied the state’s request to eliminate coverage for 60,000 poor parents, to further pare coverage for childless adults and to cut emergency services for certain immigrants, among other requests. The state was looking to save $52 million from those changes.

Friday’s actions follow earlier federal approval of a state request to cut services to childless adults and the medically needy, giving the state more than half of the $500 million it was hoping to save on health care.

“We have received the lion’s share of what we’ve asked for,” said Matthew Benson, a spokesman for Gov. Jan Brewer. “And certainly that’s a success from that standpoint, (but) it’s not a situation where you’re going to do an end-zone dance.”

Advocates said they were relieved to see that services to poor parents were preserved, but disheartened by the additional restrictions to health care in the state.

“Every dollar not spent is care not given to people who need it,” said Dana Naimark, president of the Phoenix-based Children’s Action Alliance.

CMS will allow Arizona to review its decisions and respond, said Cindy Mann, deputy administrator for the agency, in a conference call Friday. But she said these decisions are expected to go through.

Even though CMS acknowledges that changes to Arizona’s program are necessary for the state to address its financial problems, Mann said that none of its decisions hinge on state savings alone.

“It’s a not a sufficient justification to depart from federal law because there (are) cost pressures on the states,” she said.

For that reason, the agency rejected Arizona’s request to eliminate coverage for parents with family incomes between 75 percent and 100 percent of the federal poverty level.

A handful of key decisions remain on the table.

CMS is still weighing a proposed Safety Net Care Pool that would use local funds to reimburse health care providers for costs not covered by Medicaid. The agency is also considering whether or not to exempt American Indians from all the Medicaid changes in the state.

However the feds decide, the governor’s office is confident that the Arizona Health Care Cost Containment System – the state’s Medicaid office – will function effectively, given the flexibility the state has already been granted.

“The agency will be able to make this work,” Benson said.

That statement was echoed Friday by an AHCCCS spokeswoman.

“I think, through different measures that we’re taking, we are hoping to be able to adjust for that,” failure to get all the changes requested from the federal government, said Monica Coury, the spokeswoman. “We’ll continue to monitor what savings our efforts yield and, again, we are on track we think to meet the appropriate budget reduction.”

But advocates say the damage is already done.

“This is a few additional dents, and we’ve already totaled the car,” Naimark said.

Scorecard on state’s Medicaid requests

Federal officials have ruled on most of Arizona’s proposed Medicaid changes, but are still weighing some:


  • $4 copayments on non-emergency medical transportation for childless adults in Maricopa and Pima counties.
  • $3 missed medical appointment fee for parents and childless adults outside of Maricopa and Pima counties.
  • Authority to impose copayments on childless adults.
  • Elimination of screening and treatment benefits for 19- to 20-year-old childless adults.
  • Authority to provide an additional 60 days of eligibility for people who recently lost Supplemental Security Income.
  • Expenditure authority for Medicare Part B premiums for certain dual eligibles.


  • Elimination of coverage for 60,000 parents with family income between 75 and 100 percent of the federal poverty level.
  • Authority to further reduce the enrollment level of childless adults based on available funding.
  • Authority to adjust eligibility redetermination to every six months.
  • Cost-sharing limitations to permit copayments on children, pregnant women and TANF parents.
  • Elimination of coverage for emergency services for those who qualify for Medicaid except with respect to their immigration status.
  • Authority to impose a $50 annual assessment on childless adults who smoke.

On the table

  • Establishment of a Safety Net Care Pool.
  • Establishment for Arizona Health System Improvement Pool.
  • Authority to exempt American Indian/Alaskan Natives from recent benefit/eligibility changes.
  • Reimbursement to state of $40 million spent on Medicare.

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