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Court ruling allows co-pays for AHCCCS patients

A judge’s ruling that allows the state’s Medicaid system to charge fees to some patients will generate an additional $21 million a year for Arizona’s staggering budget deficits.

But that figure pales in comparison to claims made by State Treasurer Dean Martin, who announced March 31 that the state could save nearly $1 billion and preserve healthcare for hundreds of thousands of people if co-pays were charged to patients.

The ruling by U.S. District Judge Earl Carroll lifts an injunction in ~Newton-Nations v. Rodgers~ that had been in place since 2003 when the Arizona Health Care Cost Containment System, the state’s Medicaid program, tried to implement a plan to charge co-pays for childless adults. AHCCCS spokeswoman Monica Coury said AHCCCS will move forward with the plan, which will institute co-pays for about 205,000 childless adults.

“We hope to have our systems operational by Oct. 1,” Coury said.

According to AHCCCS estimates, the co-pays will generate a total of about $21 million a year, with about $6 million coming directly from the co-pays and the rest coming from federal matching funds. AHCCCS is also seeking approval for a plan to charge co-pays for patients who are transitioning off of Medicaid, which is expected to generate about $300,000 a year.

The AHCCCS plan calls for maximum co-pays of $3.40, which the agency said is the maximum allowed under federal law.

As part of its recently passed budget, the Legislature and Gov. Jan Brewer rolled back AHCCCS benefits to eliminate coverage for about 310,000 people, a plan that was expected to generate about $385 million in 2011. But the landmark federal health care bill passed by Congress on March 21 prohibits states from changing Medicaid eligibility, meaning Arizona must scrap its plans to cut back on AHCCCS and eliminate KidsCare, its arm of the federal Children’s Health Insurance Program.

The Legislature passed a bill on March 31 authorizing Brewer to spend state money to sue the federal government over the health care bill. It also passed a concurrent resolution calling on Congress to repeal the bill, known as the Patient Protection and Affordable Care Act.

Also on March 31, Martin, a candidate for governor, unveiled a plan to begin charging premiums and co-pays for AHCCCS patients, a plan he said would preserve health care for 310,000 AHCCCS patients and 47,000 KidsCare patients while generating $987 million for the state. The tiered plan would charge more for patients who earn more than 33 percent of the federal poverty limit, a group of people who were ineligible for AHCCCS until voters approved Proposition 204 in 2000.

“This is the only way that we have a hope of keeping the program alive,” Martin said.

AHCCCS officials said the co-pays would not generate anywhere close to the type of money Martin included in his plan.

Under federal law, states cannot charge enforceable co-pays for most patients, meaning service cannot be denied for non-payment. Of the 1.4 million Arizonans receiving care under AHCCCS, only childless adults and people who are transitioning off of Medicaid can be charged, Coury said.

There are about 40,000 transitional AHCCCS patients – half cannot be charged co-pays because they are children – and Coury said AHCCCS has begun the process of getting federal approval to charge co-pays to those patients.

Coury said the state could apply to the federal government for a waiver to charge enforceable co-pays to other AHCCCS patients, another facet of Martin’s plan, but said she considered it extremely unlikely that such a waiver would be granted.

“I’ve never heard of a state getting that kind of a waiver,” she said.

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