WASHINGTON – Arizona is the only state that expects to cover fewer people under its Medicaid program in 2012 than it did in 2011, according to a new report by the Kaiser Family Foundation.
Arizona is one of 11 states that reduced their Medicaid budgets this year. But while the others plan to prevent declines in enrollment, Arizona expects changes in the program to shed 96,000 people from coverage by next summer, according to the report.
Unlike most other states, Arizona’s Medicaid program was recently up for renewal. Federal health care reform prevents states from scaling back coverage, but because Arizona’s program was set to expire Oct. 1, it could be tweaked with federal approval.
That gave the state a cost-cutting opportunity unavailable to most, at a time when Arizona was hit harder than most in the recession.
“They had this opportunity to renegotiate with the federal government,” said Tracy Gordon, a fellow at the Brookings Institution. “Once you’re in one of these (Medicaid contracts) you might not always be able to get out.”
Following negotiations with federal officials, Arizona was able to eliminate coverage for 6,000 medically needy people and freeze coverage for 90,000 childless adults, resulting in an expected enrollment drop from roughly 230,000 to 140,000. These cuts will save the state an estimated $260 million.
The cuts are part of Gov. Jan Brewer’s efforts to save up to $500 million from the Arizona Health Care Cost Containment System, the state’s Medicaid program.
Despite the cuts, AHCCCS said it expects to be able to function effectively.
“Based on where we stand today, we can expect to operate our current Medicaid program within the confines of our current budget,” said Jennifer Carusetta, chief legislative liaison for AHCCCS.
Every state faces increased budget pressure in 2012 because higher-than-usual federal contributions to Medicaid expired in June. The money, provided under the American Recovery and Reinvestment Act, sent $103 billion to the states over the preceding three years, said Vernon Smith, who co-authored the Kaiser report.
As part of that funding, AHCCCS got about three dollars for every dollar the state invested in Medicaid since October 2008. That federal-to-state ratio fell to about 2-to-1 in July when the higher rate expired.
Smith called the enhanced federal match rate “one of the most significant things” in Medicaid’s history.
“Even with the enhanced (rates), there were still state budget shortfalls of historic size,” he said. “But these cuts would have been much, much greater without the enhanced Medicaid funding.”
But the new, lower federal support places a heavy burden on states, which have increased spending by an unprecedented 28.7 percent from fiscal 2011 to fiscal 2012, Smith said.
Arizona increased its share of Medicaid spending by $50 million – 1 percent of the Medicaid budget – but cut more than $1.5 billion from the program, most of that in foregone federal funding.
States, including Arizona, are finding other ways to minimize costs, by limiting and eliminating certain benefits, increasing copayments for beneficiaries and cutting reimbursement rates to providers who serve Medicaid patients.
“A lot of those one-time measures make sense when you’re really up against a wall,” Gordon said.
“But having run out of those, and run out of solutions, I can see why they (Arizona) would take advantage of the opportunity” to renegotiate with the federal government, she said.
Community advocates said the costs to society far outweigh the savings to the state, but that they are not surprised the legislature does not see it that way.
“The folks are struggling today because they have lost their jobs or have had a healthcare emergency that has wiped out their savings,” said Cynthia Zwick, executive director of the Arizona Community Action Association. “It’s just a huge cycle that they fall into once things start to fall apart.”
Max Levy is a reporter for Cronkite News Service.
Leon Ceniceros posted at 12:37 pm on Mon, Oct 31, 2011.
It's time to stop punishing the hard-working Arizona Citizens who have made something of themselves...done something in their lives....and rewarding the people who never studied in School....never worked hard...never stopped having baby after baby after baby just to get Welfare money and Food Stamps..became addicted to drugs and alcohol.......yet expected to be given everything by the "State".
Some of these Liberal-Progressive "commenters" should look at the Flag flying from our City Halls....it's Old Glory, the Stars and Stripes....not the Red "Star" Flag of Communist China, not the Red Sickle Flag of Communist Russia. They live in a Capitalist Republic not a Communist-Socialist ...."Welfare Nation".
Leon Ceniceros posted at 12:29 pm on Mon, Oct 31, 2011.
Finally seeing some "sanity" in the old Left-Wing Medicaid give-away program. Getting these 30 year old, "Permanent" Welfare "Mama's and Papa's and the Un-Employment "Kings and Queens" off the Democrat's 1990's "Tax and Spend" Welfare State.
All of these people are going to have to "Take Care Of Themselves" for a change...Nappy be gone to D.C..
We see all the "California Wanna-Be's" whinning and complaining because their Napolitano "Socialist Cradle-to-Grave Welfare State" is being demolished....boo hoo hoo...........
If you want "State Hand-Outs"....California is only a short 5 hour ride. Take your pick of the 3 Stooges...San Diego, Los Angeles or San Francisco or pass GO and take a flight to Havana...there is no such thing as an "Obesity Epedemic" in Cuba = no food...........[sad]
Diogenes Lantern posted at 7:53 pm on Sat, Oct 29, 2011.
Napolitano fled Arizona leaving a $1.9 Billion Deficit in better times making AZ in the worst financial condition of any state based on debt per citizen.
Pearce and crew have finally balanced the budget without cutting education more than 1.5% (only one Lexus per administrator now).
Even though we have SB 1070, Obama, Holder and Napolitano refuse to stop illegals from flooding ths state for FREE health care, FREE education, FREE instate tuition at colleges, discouragng E-Verify (only 20% of companies use).
So Arizona has skyrocketing government worker salaries and pensions and free everything for anyone that walks over the borders.
So Bill Richardson and WordSpeaker, how do we keep the state solvent? Facts, pleae. Enough insults.
Wordspeaker posted at 2:21 pm on Fri, Oct 28, 2011.
What gets to me is that someone flipping burgers at McDonalds makes more than those trained to care for the disabled and seriously disabled here in Az. Over the past year they have cut 15% of the pay of these people and taken a large part of the medical also from the disabled. I guess it comes down to who is the easiest to put the shaft to , mainly those who cannot defend themselves. A shame our society has come to this..
BillRichardsonMesa posted at 4:39 am on Fri, Oct 28, 2011.
Makes me wonder how Russell Pearce can say that we're doing everything right. Something is not going right.
Sick_inAz posted at 9:23 pm on Thu, Oct 27, 2011.
The party of death Az repulicans. Calls are already going out letting people know they're stopping chemotherapy on the needy. Atleast they wont make you suffer you get a week ahead of time notice.
Trans posted at 7:14 pm on Thu, Oct 27, 2011.
So we're one step closer to being a third world country-within-a-country. How proud we should all be!