The House and Senate ended the first special session of 2011 by approving a bill authorizing Gov. Jan Brewer to ask the federal government for permission to drop 280,000 patients from the state’s Medicaid program.
S1001 passed the Senate on a 21-9 vote and the House by a 40-20 vote on Jan. 20. The party-line votes give it the two-thirds majority it needs to go into effect immediately after Brewer signs it.
Brewer spokesman Paul Senseman said the governor will sign the bill Friday morning and apply for the waiver by Monday.
Brewer’s budget proposal, which she released last week, calls for the state to cut $542 million from AHCCCS to help balance a projected $1.15 billion budget deficit in the fiscal year 2012. But the state needs a waiver from a mandate in the 2010 federal health care law that prohibits states from reducing eligibility for their Medicaid programs.
“I support this bill, not because I am filled with glee, but because we were elected to balance the state budget,” said House Majority Whip Debbie Lesko. “We are down to bad options and worse options. And we were elected to solve the problem.”
Brewer is seeking a two-year waiver, which would allow the state to drastically reduce AHCCCS eligibility until 2013, when the health care law will require all states to provide Medicaid coverage to anyone earning up to 133 percent of the federal poverty level.
Democrats called Brewer’s budget plan “unrealistic.” They said it would take the federal government 10 months to review Arizona’s application for a Medicaid waiver, and said they doubted the federal government would actually approve the request.
Republicans said Arizona has a good case to make before the federal government, considering that large corporations and labor groups were granted a similar waiver. House Majority Leader Andy Tobin said the feds have approved 222 waivers to companies like McDonald’s and labor unions like the Service Employees International Union.
“It amounts to 1.5 million enrollees,” Tobin said. “That’s more than we even have on our AHCCCS program.”
Even if the federal government approves the waiver, lawmakers from both parties said they expected a court battle to determine whether state law bars Arizona from reducing AHCCCS eligibility. Proposition 204, passed by voters in 2000, raised AHCCCS eligibility to 100 percent of the federal poverty level. Because the funding was mandated by voters, proponents say it can’t be cut without violating the voter-protection language in the Arizona Constitution.
Democrats argued that cuts to AHCCCS would violate Proposition 204, while Republicans said the cuts are permitted due to language in the law that says AHCCCS must be funded by revenues from a court settlement with tobacco companies and other “available funds.”
“It is suggested that we are violating the will of the people…but the people never voted to spend one dime of general fund money,” said Rep. John Kavanagh, chairman of the House Appropriations Committee.
Rep. Chad Campbell, the House Minority Leader, countered with a passage from the 2000 publicity pamphlet for Proposition 204, which stated that future legislatures could expand AHCCCS coverage, but could not reduce it.
“It is very clear what the voters intended when the passed his,” Campbell said. “I could read more and more about this. But we’re going to let this get decided in a court, I think, which has become our tradition here in Arizona.”
The bill passed with an emergency clause after beating back an attempt by Senate Democrats to raise the vote threshold.
The bill, which contains an emergency clause, needed two-thirds of the Legislature to pass. But Sen. Kyrsten Sinema, a Democrat from Phoenix, wanted to raise the vote requirement to a three-fourths majority. House Democrats made a similar push in the House Rules Committee earlier in the day.
Sinema said her amendment would have put the state in a better position against lawsuits challenging its constitutionality.
“I was asking them to follow the constitution,” Sinema said.