Arizona Health Care Cost Containment System (AHCCCS) Program
Spending for the AHCCCS program went from $2 billion in 2000 to $4.7 billion in 2007. In just the past 12 months, another 207,800 Arizonans are receiving benefits.
How did this happen?
In 1984, the first year AHCCCS was functional, it covered just 185,409 Arizonans. As of 2007 there were 1,080,185 enrolled under this program, mostly due to changes in the law which made it easier for people to qualify for this assistance.
The initiative to fund this program, Proposition 204 (also known as “Healthy Arizona”), was passed by taxpayers who had the best intentions, and who’d understood that this program was to be funded by tobacco settlement dollars. It was anticipated that the State would receive between $92-$102 million annually from this settlement through 2006.
Additionally, what was not anticipated was the economic downturn. This, coupled with changes to the law that had earlier enabled broader participation in the AHCCCS program, has created a situation in which the costs to run the program now sharply exceed its original funding plan. As a result, AHCCCS has become a significant drain on Arizona’s General Fund monies, diverting dollars that had originally been slated for other important areas, such as education, infrastructure, and public safety.
What’s needed now is a comprehensive review, to return AHCCCS to what it was originally intended to be: Short-term help for those Arizonans who require temporary “bridge” insurance and aid for those citizens genuinely in need of ongoing assistance. It would appear that, over time, AHCCCS has become the insurance program of thousands of working people, some who could actually contribute to an affordable program if it were available.
Reform is sorely needed. In addition to a full review of the program’s administration, Arizona voters should be provided the opportunity to revisit Prop. 204, to cap general fund spending on AHCCCS, and/or to limit funding to those dollars provided by the tobacco settlement.
Other reforms are also needed to ease the weight of AHCCCS. These should include changes in state health insurance industry regulations to increase competition among insurers and cause them to offer basic, less-expensive plan options for those unable to afford comprehensive coverage; and existing tort law must be revisited by our State Legislature.
(Statistics above from Governor’s Executive Budget Status Report, 12/09 and Ballot Proposition 204, publicity pamphlet at State of Arizona official website.)
