AHCCCS 2008 Legislative Summary

Arizona Health Care Cost Containment System
Office of Intergovernmental Relations

AHCCCS- Initiated Legislation
SB1133

AHCCCS; DES; new hires directory (Senator Leff)

Disposition

Enacted; Chapter 79

Effective Date

September 26, 2008

Summary

•

Conforms Arizona Revised Statutes to federal laws allowing AHCCCS to use
information compiled in the Arizona New Hire Directory to verify eligibility
for Medicaid programs.

SB1223
Disposition
Effective Date
Summary

insurance; long-term care (Senator Allen)
Enacted; Chapter 230
July 1, 2009
•

SB1329

Implements the requirements of the Deficit Reduction Act of 2005 into state
statute to allow AHCCCS to participate in Long-Term Care Partnership
Programs with private insurance industry.
AHCCCS; self-directed care services (Senator Allen)

Disposition

Enacted; Chapter 58

Effective Date

September 26, 2008

Summary

•

•

Allows qualified members of the Arizona Long-Term Care System (ALTCS)
who are participating in home and community-based services to appoint an
attendant caregiver to provide specific services as designated in rule by the
Administration, in consultation with the Board of Nursing.
Requires AHCCCS to report on utilization of the Self-Directed Care Program
by January 1, 2011.

2

AHCCCS- Related Legislation
HB2166
Disposition
Effective Date
Summary

AHCCCS; healthcare group; waiting period (Representative Prezelski)
Failed to pass out of the House
September 26, 2008
•

HB2208
Disposition
Effective Date
Summary

graduate medical education; federal match (Representative Burns)
Enacted; Chapter 158
September 26, 2008
•

HB2247
Disposition
Effective Date
Summary

Eliminates the bare period as a requirement to enroll in Healthcare Group

Requires AHCCCS to seek federal authorization to define certain activities
associated with administering graduate medical education programs in hospital
facilities as “administrative activities” for the purpose of drawing down
additional federal matching funds.
Indian Affairs Commission; legislative day (Representative Tom)

Failed to pass out of the Senate
September 1, 2009
•
•
•
•
•

Adds the Director of AHCCCS as one of two non-voting members on the
Arizona Commission of Indian Affairs
Combines the activities and authority of the Arizona Commission of Indian
Affairs and the Advisory Council on Indian Health Care
Requires AHCCCS to request a waiver from federal requirements that would
enable tribal authorities who conduct TANF eligibility determinations to also
conduct Medicaid eligibility determinations
Upon approval of the waiver, requires the State to provide matching funds for
expanded eligibility activities
Establishes a fund for revised Commission activities

3

HB2326
Disposition
Effective Date
Summary

AHCCCS; naturopathic services (Representative Stump)
Failed to pass out of the House
September 26, 2008
•

HB2399
Disposition
Effective Date
Summary

AHCCCS; healthcare group (Representative Farley)
Failed to pass out of the House
September 26, 2008
•

HB2400
Disposition
Effective Date
Summary

Effective Date
Summary

Exempts employer groups with five or more employees from the bare period
requirement
AHCCCS; member’s employers; reports (Representative Farley)

Failed to pass out of the House
September 26, 2008
•

HB2401
Disposition

Adds naturopathic services to the list of covered services available to
AHCCCS members

Requires AHCCCS to report by November 15th of each year to the Legislature
on the number of employers represented in Healthcare Group and how many of
each businesses’ employees are enrolled in Healthcare Group
healthcare businesses; consumer information (Representative Farley)

Failed to pass out of the Senate
September 26, 2008
•

Requires healthcare businesses to disclose whether individually identifiable
information is transmitted to a contractor outside of the United States

4

HB2462
Disposition
Effective Date

Summary

s/e: healthcare group (Representative Burns)
Failed to pass out of the Senate
Revised enrollment limit effective August 1, 2008; Additional provisions have a
general effective date
•
•
•
•
•
•
•
•
•

HB2503
Disposition
Effective Date
Summary

Makes numerous changes to Healthcare Group (HCG) enrollment and contract
requirements
Effective July 1, 2007, limits enrollment to no more than 10% of total enrolled
employer groups
Eliminates the 180-day bare period
Eliminates groups of one from those who are eligible to enroll in HCG
Prohibits HCG from reimbursing non-contract hospitals for non-emergency
services and those not required for post-emergency stabilization
Limits HCG reimbursement to non-contracted hospitals to 114% of AHCCCS
reimbursement rates for emergency and post-stabilization services
Requires HCG to set premiums that, in the aggregate, cover the costs of
administering the program based on an analysis conducted by an independent
actuary
Allows HCG to consider health-related factors when establishing rates
Requires HCG to provide the following items to the Joint Legislative Budget
Committee (JLBC):
o Quarterly financial reports
o Annual fiscal audits
o Actuarial analysis used to establish premiums
durable medical equipment; report (Representative Burns)

Enacted; Chapter 180
September 26, 2008
•

Requires AHCCCS to report the following items to the Legislature by
November 15, 2008:
o A list of vendors who provide durable medical equipment (DME) to
AHCCCS and its contracted health plans
o The number of enrolled members utilizing DME
o The number and outcomes of grievances filed with the Administration and
contracted health plans related to DME provision and repair

5

HB2505
Disposition
Effective Date
Summary

child support; medical insurance (Representative Barto)
Enacted; Chapter 181
September 26, 2008
•
•

HB2541
Disposition
Effective Date
Summary

AHCCCS; breast cancer treatment (Representative Sinema)
Failed to pass out of the House
September 26, 2008
•

HB2669
Disposition
Effective Date
Summary

Failed to pass out of the Senate
September 26, 2008
•

HB2703

Effective Date
Summary

Requires AHCCCS to provide breast cancer treatment to eligible members
regardless of where they obtained their breast cancer screening
behavioral health delivery system; study (Representative Barto)

•

Disposition

In child custody cases, requires the Court to determine whether or not either
parent has access to health coverage or has AHCCCS coverage
If neither parent has health-care coverage, requires the court to determine
whether additional financial support is necessary to ensure medical coverage
for the child

Establishes the 19 member Behavioral Health Task Force to study the State’s
behavioral health service delivery system
Requires the Task Force to report on its progress to the Governor and the
Legislature by December 15, 2008
large employers; AHCCCS; reimbursement (Representative Alvarez)

Failed to pass out of the House
September 26, 2008
•

Requires an employer with 100 or more employees to reimburse AHCCCS for
the cost of covering an employed individual who is enrolled in the program

6

HB2777
Disposition
Effective Date
Summary

AHCCCS; DES; fraud reduction (Representative Crump)
Failed to pass out of the Senate
September 26, 2008
•
•

HB2840
Disposition
Effective Date
Summary

health care; high risk program (Representative Adams)
Failed to pass out of the House
Effective January 1, 2010
•
•
•
•

HCR2044
Disposition
Summary

Requires AHCCCS and DES to conduct a pilot project with a vendor on fraud
reduction technology
Requires AHCCCS and DES to enter into a contract with a vendor for
prescribed fraud reduction technology measures

Establishes the Healthcare Group High Risk Program to provide medical
coverage for individuals who are unable to obtain medical coverage in the
private sector
Establishes a Board of Directors to implement and administer the Healthcare
Group High Risk Program
Provides that funding for the Healthcare Group High Risk Program shall be
allocated from member premiums that are limited to 150%-200% of the
standard rate and surplus premium tax revenues collected from private insurers
Repeals Healthcare Group effective January 1, 2011
voter-protection; temporary budget suspension (Representative Pearce)

Failed to pass out of the Senate
•

A ballot initiative that proposes to suspend voter-approved spending
requirements in the event that both JLBC and OSPB provide written findings
that the fiscal year is projected to end with a deficit

7

SB1072
Disposition
Effective Date
Summary

AHCCCS; proof of citizenship (Senator Harper)
Failed to pass out of the Senate
September 26, 2008
•
•
•
•

Requires AHCCCS to report individuals who have been identified to be illegal
immigrants to immigration authorities
Stipulates that employees and supervisors who do not comply with this
requirement are guilty of a Class 2 Misdemeanor
Prohibits AHCCCS employees from accepting state or locally-issued
identifying documentation from an individual unless the person’s citizenship
status has been verified
Establishes a cause of action for any individual who has discovered a violation
of these requirements

SB1093
Disposition
Effective Date
Summary

insurance providers; long-term care (Senator Allen)
Failed to pass out of the Senate; language enacted on SB1223 (Chapter 230)
July 1, 2009
•

SB1234
Disposition
Effective Date
Summary

AHCCCS; occupational therapy; speech therapy (Senator Allen)
Failed to pass out of the Senate
October 1, 2008
•

SB1250
Disposition
Effective Date
Summary

Implements the requirements of the Deficit Reduction Act of 2005 into state
statute to allow AHCCCS to participate in Long-Term Care Partnership
Programs with private insurance industry

Adds outpatient occupational and speech therapy to the list of covered services
available to AHCCCS members
prescription marketing costs; full disclosure (Senator Burton Cahill)

Failed to pass out of the Senate
February 1, 2009
•
•

Requires prescription drug manufacturers or labels to submit an annual report
of their marketing costs in Arizona to AHCCCS
Requires AHCCCS to biennially report on prescription drug marketing
activities to the Governor and Legislature beginning October 1, 2010
8

SB1376
Disposition
Effective Date
Summary

AHCCCS; hospital reimbursement (Senator O’Halleran)
Failed to pass out of the House
September 26, 2008 (Some provisions have a delayed effective date)
•
•
•
•
•

SB1389
Disposition
Effective Date

Summary

Establishes a Hospital Reimbursement Advisory Council to oversee
compliance with AHCCCS timely pay requirements
Makes numerous changes to AHCCCS contract health plan timely pay
requirements and revises late payment penalties for health plans in violation of
timely pay requirements
Establishes rule-making and administrative requirements for AHCCCS related
to revised timely pay requirements
Requires that the Administration convene a workgroup to consider several
issues including “date received” and supplemental recoupment and transmittal
requirements
Requires the Director to establish a process and timeline to sanction contract
health plans that do not meet revised timely pay requirements
healthcare group; health plans; information (Senator Chuevront)

Failed to pass out of the House
Revised enrollment limit effective August 1, 2008; Additional provisions have a
general effective date
•
•
•
•
•
•
•
•
•

Makes numerous changes to Healthcare Group (HCG) enrollment and contract
requirements
Limits enrollment to no more than 10% of total enrolled employer groups
Eliminates the 180-day bare period
Eliminates groups of one from those who are eligible to enroll in HCG
Prohibits HCG from reimbursing non-contract hospitals for non-emergency
services and those not required for post-emergency stabilization
Limits HCG reimbursement to non-contracted hospitals to 114% of AHCCCS
reimbursement rates for emergency and post-stabilization services
Requires HCG to set premiums that, in the aggregate, cover the costs of
administering the program based on an analysis conducted by an independent
actuary
Allows HCG to consider health-related factors when establishing rates
Requires HCG to provide the following items to the Joint Legislative Budget
Committee (JLBC):
o Quarterly financial reports
o Annual fiscal audits
o Actuarial analysis used to establish premiums
9

SB1418
Disposition
Effective Date
Summary

tobacco cessation; coverage; AHCCCS (Senator Leff)
Enacted; Chapter 131
October 1, 2008
•
•

Allows AHCCCS and its contracted health plans to offer tobacco-cessation
medications and nicotine replacement therapies to enrolled Medicaid (Title
XIX) members
Stipulates that funding for these services shall not come from the General Fund

10

Budget Legislation
HB2043
Disposition
Effective Date
Summary

FY 2007-2008 state hiring; moratorium (Representative Robson)
Vetoed
Emergency Measure
•

HB2209
Disposition

Prohibits state agencies from hiring or promoting employees through FY 20072008
general appropriations act; 2008-2009 (Representative Burns)

Enacted; Chapter 285

Effective Date Emergency Measure
Summary

•

Makes appropriations to state agencies for the administration of activities in FY
2008-2009

AHCCCS APPROPRIATIONS
Agency Lump Sum Reduction: $1M
Administration- $210.9M
• Operating Budget- $70.1M
• DOA Data Center Charges- $5.7M
• Indian Advisory Council- $233K
• DES Eligibility- $55.7M
• DES Title XIX Pass-Thru- $358K
• Healthcare Group & Reinsurance- $11.5M
• Office of Administrative Hearings- $271K
• Kidscare Administration- $9.4M
• Prop. 204 AHCCCS Administration- $11.4M
• Prop. 204 DES Eligibility- $43.6M
• DES Eligibility System Upgrade- $2.6M
Acute Care- $4.8B
• Capitation $2.1B
• Reinsurance $134.2M
• Fee-for-Service: $573.4M
• Medicare Premiums: $96.3M
• GME: $45M
• Prior Year TMC Reconciliation: $3.2M
• Dual Eligible: $1M

11

•
•
•
•
•
•
•
•
•
•
•
•
•

DSH: $30.4M
Critical Access Hospitals: $1.7M
Breast & Cervical Cancer: $1.5M
Ticket to Work: $8.9M
Prop 204- Capitation: $1.2B
Prop 204- Reinsurance: $130M
Prop 204- Fee-for-Service: $243.4M
Prop 204- Medicare Premiums: $31.3M
Prop 204- County Hold Harmless: $4.8M
Kidscare Children: $145.3M
Kidscare Parents: $35M
Rural Hospital Reimbursement: $12.2M
Medicare Clawback Payments: $29M

ALTCS- $1.2B
• Program Lump Sum: $1.2B
• Medicare Clawback: $20.7M
• Dual Eligible: $470K
• Board of Nursing: $210K
AHCCCS POLICY PROVISIONS
Disproportionate Share
• Stipulates that the $30.4M appropriation for disproportionate share payments for FY 20082009 includes $4.2M for Maricopa County Healthcare District and $26.1 M for private
qualifying disproportionate share hospitals
Proposition 204 County Hold Harmless
• Outlines distributions to counties under the Prop. 204 county hold harmless line-item as
follows
Temporary Medical Coverage Reconciliation
• Stipulates that prior year temporary medical coverage program reconciliation shall be used to
pay claims with dates of service prior to July 1, 2008
HB2275
Disposition
Effective Date
Summary

now: budget reconciliation; health (Representative Hershberger)
Enacted; Chapter 288
September 26, 2008
•
•

Establishes policy guidance related to the administration of health
programs in FY 2008-2009
Provides the following policy guidelines for AHCCCS:

12

Redeterminations
• Establishes a six-month redetermination period for childless adults over 21 years of age
Budget Neutrality Compliance Fund
• In FY 2008-2009, requires counties with two million or more persons to transfer $24,168,400 to
AHCCCS for deposit into the Budget Neutrality Compliance Fund
• Requires counties with more than eight hundred thousand, but less than two million persons to
transfer $3,794,400 to AHCCCS for deposit into the Budget Neutrality Compliance Fund
• In FY 2008-2009, prohibits AHCCCS from transferring $17,830,500 to counties for refunds of
ALTCS costs for FY 2006-2007 and FY 2007-2008
• Requires AHCCCS to instead deposit $17,830,500 in the Budget Neutrality Compliance Fund
Temporary Medical Coverage
• Suspends the TMC program during FY 2008-2009
Hospital Reimbursement Rates
• Effective October 1, 2008-September 30, 2009, AHCCCS is prohibited from increasing inpatient
hospital per diem rates, inpatient hospital outlier thresholds and aggregate hospital fee schedule
rates above levels in effect on September 30, 2008
• Provides that AHCCCS may continue to phase-in outlier cost-to-charge ratios as prescribed in
the FY 2007-2008 budget
County Contributions and Withholding
• Outlines county Acute Care, ALTCS and hospital and medical care contribution levels
• Stipulates that if counties do not make their required contributions, the State Treasurer shall
reduce the contribution (plus interest) from that county’s portion of state-shared revenues,
excluding HURF
• Expresses Legislative intent that the Maricopa County’s Acute Care contribution shall be
reduced each year in accordance with the GDP Price Deflator
Disproportionate Share
• Provides that FY 2008-2009 disproportionate share payments are:
o $89.9M for a qualifying nonstate operated public hospital
o $28.6M for the Arizona State Hospital
KidsCare Parents
• Establishes KidsCare Parents in statute (previously session law) at current eligibility levels
• Stipulates that eligibility and program administration are dependent upon the continuation of
enhanced federal matching funds
• Stipulates that the program ends on the expiration of the enhanced matching rate
• Requires individuals enrolled in the program to make monthly premiums as follows:
o 100%-149% FPL: 3% household income
o 150%-174% FPL: 4% household income
o 175%-200% FPL: 5% household income

13

Healthcare Group
• Allows HCG to establish a PPO only in counties with less than 500,000 persons
• Eliminates eligibility for groups of one (grandfathers currently enrolled groups of one)
• Shortens the bare period to 90 days
• Prohibits HCG from reimbursing non-contracted hospitals for non-emergency services
• Establishes the reimbursement rate for emergency services performed in a non-contracted
hospital as follows:
o Counties with 500,000 or more persons: 114% AHCCCS default rates
o Counties with less than 500,000 persons: 125% AHCCCS default rates
• Eliminates the prohibition against the consideration of health-related factors when establishing
premium levels
• Requires HCG to adjust premiums in accordance with an analysis performed by an independent
actuary
• Requires HCG to establish premiums that, in the aggregate, cover projected medical and
administrative costs for that contract period and that are consistent with generally accepted
principles and practices as determined by an independent actuary
• Prohibits a plan from providing services that are not part of the contract
• Requires HCG to establish utilization control standards for contractors that meet national
standards for utilization management control
• Prohibits HCG from enrolling more than 5% of the number of employer groups enrolled during
the prior fiscal year
• Requires HCG to give priority to uninsured groups
• Requires HCG to report the following to JLBC:
o Quarterly financial reports
o Annual fiscal audit
Actuarial analysis used to adjust rates
HB2620

budget adjustments; fiscal year 2007-2008 (Representative Boone)

Disposition

Enacted; Chapter 53

Effective Date

Emergency Measure

Summary

•

Adjusts the enacted FY 2007-2008 budget to address the projected deficit

AHCCCS CHANGES:
• Shifts $73.06 from AHCCCS Emergency Services to the General Fund
• Appropriates $4.7M from the General Fund in FY 2007-2008 to AHCCCS
• Reduces the FY 2007-2008 appropriation to AHCCCS from the Medically Needy Account by
$13.1M
• Reduces the FY 2007-2008 appropriation from the Emergency Health Services Account to
AHCCCS by $4.1M
• Requires counties with a population of two million or more persons to transfer $5.5M to
AHCCCS for deposit in the Budget Neutrality Compliance Fund

14

•
•

Requires counties with a population of less than two million persons to transfer $1.5M to
AHCCCS for deposit in the Budget Neutrality Compliance Fund
Appropriates $7,026,800 from the Budget Neutrality Compliance Fund to AHCCCS.
HB2857
Disposition
Effective Date
Summary

fiscal year 2007-2008 budget adjustments (Representative Boone)
Vetoed
Emergency Measure
•

Prohibits state agencies from expending or encumbering various state
funds in anticipation of the FY 07-08 budget adjustment

15