Arizona Faces Economic and Healthcare Crisis with $122M Medicaid Shortfall

The Arizona Health Care Cost Containment System (AHCCCS), or Medicaid in Arizona, is facing a critical $122 million budget shortfall, impacting the state's ability to provide health care for over 60,000 residents, including around 10,000 in Pima County.

The funding crisis stems from budget issues within the state’s Division of Developmental Disabilities. This alarming financial situation threatens to disrupt services for a substantial portion of Arizona's Medicaid enrollees, which number over 2 million, with approximately 37% being children.

Significant economic repercussions are anticipated statewide, including the potential loss of approximately 36,000 jobs and a $33.7 billion reduction in economic activity, as Medicaid spending cuts could also result in a decline of $138.1 million in state and local tax revenues. The proposed cuts could severely affect not only individuals needing medical and behavioral health services but also the broader economic landscape across Arizona, spanning multiple industries and drastically reducing labor income.