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November 2, 2020

AHCCCS Stabilizes Health Care Providers with Financial Relief During COVID-19 Pandemic


On Oct. 27, the Arizona Health Care Cost Containment System (AHCCCS) received federal approval from the Centers for Medicare and Medicaid Services (CMS) to increase Arizona hospital reimbursement rates by more than 30 percent.

The Hospital Enhanced Access Leading to Health Improvements Initiative (HEALTHII) will result in a net increase in payments to eligible Arizona hospitals of approximately $800 million in the first year of implementation, a more than 30 percent effective rate increase over current reimbursement rates.

“AHCCCS and CMS have worked for the past year to implement this significant and impactful program for hospitals,” Jami Snyder, AHCCCS director, said. “Hospitals have been hit especially hard during the COVID-19 public health emergency; this rate increase approval comes at a time when our hospitals need it most.”

"We thank Governor Doug Ducey and AHCCCS for their leadership in the implementation of HEALTHII,” said Jennifer Carruseta, executive director of the Health System Alliance of Arizona. “These critical resources will help hospitals as they continue to combat the COVID-19 crisis in our communities while also providing world-class care to patients across Arizona."

“The Arizona Hospital and Healthcare Association appreciates the support AHCCCS has provided hospitals and other healthcare providers as we collectively navigate these unprecedented times,” AZHHA president and CEO, Ann-Marie Alameddin, said. “These payments will help provide financial viability to hospitals and will strengthen the network of providers to help meet the needs of patients during COVID-19 and into the future.”

"ArMA is grateful to Governor Ducey for signing the Healthcare Investment Act earlier this year and to CMS for approving the waiver request. Over the past decade, there was a nearly 15 percent rate decrease for physicians who serve Medicaid patients in Arizona. At a time when access to health care is critical to everyone, the restoration of reimbursement rates to pre-2009 levels is critical to ensuring that all patients have appropriate access to care. ArMA applauds the work of the entire healthcare community to make this happen,” said Ross Goldberg, MD, president of the Arizona Medical Association.

Since March 2020, eligible rural acute care hospitals, known as Critical Access Hospitals, received an additional $5.3 million. Hospitals that participated in the 2019 Graduate Medical Education Program received $50 million in accelerated payments.

Furthermore, several hospitals, primary care providers, behavioral health outpatient providers, and behavioral health clinics that coordinate services for formerly incarcerated individuals were advanced more than $41 million in scheduled payments.

Nursing facilities (NF’s) and assisted living facilities (ALF’s) provide health care services to some of the state’s most vulnerable individuals. Financial support included:

Many Medicaid members enrolled in the Arizona Long Term Care System (ALTCS) who are elderly or who have physical disabilities receive attendant care and personal care services in their homes. Home and Community Based Services providers who deliver these services received approximately $300,000 in retainer payments to cover financial losses when they were not able to deliver planned services due to COVID-19.

Lastly, dental providers and practitioners (e.g. primary care providers, specialists, and nurse practitioners) received an annual rate increase exceeding an estimated $380 million.

See the AHCCCS Provider Relief handout with these highlights.

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