The Effect of AHCCCS Disenrollment

AzHQ Study reveals: Cuts in Public Programs Increase Health Care Costs

A perennial decision faced by policy makers at the State Capitol is to determine eligibility guidelines for AHCCCS (Arizona's Medicaid program) - and to weigh the effects of such changes on the state's general welfare and budget. How would a given legislative direction change patient behaviors and utilization of health care system resources? With what cost impact?

These questions prompted SLHI to commission a study to find out. Using 2004 data from the AzHQ database, researchers from Arizona State University and Brigham Young University found that being enrolled in AHCCCS was associated with decreased emergency department use and decreased hospitalization as enrollees received more care through routine visits. A decision to change eligibility and disenroll members produces the opposite effect: more emergency department use, more hospitalizations and less routine care.

The cost? A conservative estimate indicates that maintaining enrollment in AHCCCS saves the system $4.3 million per year. Similarly, maintaining enrollment in the KidsCare Parents Program - which has been proposed for elimination in the current legislative budget - saves the system $2.4 million. Additionally, disenrollment costs the state millions in lost matching dollars from federal sources.

Evidence of the positive impact of AHCCCS on the lives of Arizonans - and on the financial stability of Arizona's health care system - supports maintaining current AHCCCS eligibility guidelines.

For a detailed paper on the study's approach, methods and results, click here.