A Republican push to slash health-care programs as part of the recently adopted 2012 state budget is either "balanced" or "devastating," depending upon who's talking.
Gov. Jan Brewer proposed the cuts and wrote: "This budget recognizes the need to comprehensively reform our state Medicaid (AHCCCS) program."
On the other hand, University Medical Center spokeswoman Katie Riley declares of the budget-reduction impacts on the health-care industry: "It's a triple whammy."
The financial savings come from a dozen expenditure cuts and benefit reforms made to AHCCCS. Locally, those changes will impact huge numbers of people.
A survey of seven area hospitals shows AHCCCS patients are a significant portion of the patients at five of them. They include 39 percent of those treated at UPH Hospital (formerly Kino), 35 percent at UMC, and 27 percent at Tucson Medical Center. Payments from AHCCCS constitute 27 percent of the revenues at Carondelet Health Network-owned St. Mary's, and almost 20 percent at St. Joseph's, also run by Carondelet.
The largest health-care reduction in the state budget is an estimated $190 million in savings from halting the enrollment of childless adults into AHCCCS. This step is projected to reduce the number of Arizonans in this category on AHCCCS from 232,000 to less than 87,000 within 30 months.
Lowering this number will impact a population with special medical needs. According to a study published last year by the Center on Budget and Policy Priorities, childless poor adults tend to be in worse health than parents, and only 12 percent of them are covered by employer-sponsored insurance.
"Nearly 60 percent of poor, uninsured childless adults report forgoing care due to cost concerns," the study states.
The effort to prohibit many poor people from enrolling in AHCCCS flies in the face of the federal health-care legislation adopted last year. That act mandates that medical coverage for the poor be expanded in 2014.
After reducing AHCCCS roles, next on the list is $95 million to be saved by cutting reimbursement rates to health-care providers. Eliminating another current method of enrolling people on AHCCCS should save another $70 million.
"When people lose health coverage, they often choose to forgo visits to a primary-care physician—which can mean preventative care, wellness checks and early detection of potentially devastating illnesses can slip through the cracks and leave them vulnerable," comments Lisa Contreras, of Carondelet Health Network, in an e-mail.
Instead of going to a doctor's office, people without medical insurance tend to visit emergency rooms for delayed and expensive health care. Thus, the state budget cuts can be expected to flood ERs with more patients.
Kimberly Chimene, spokeswoman for Northwest Medical Center, states in an e-mail: "If substantially more patients seek care in the (ER) because their access to primary care has been cut off, or they did not seek medical care until they were too ill to wait any longer and now need to be seen in an emergency room, it will be challenging to maintain low wait times."
Another major impact of the budget will involve medical costs and health-care employment. Hospitals took a 5 percent reduction in AHCCCS reimbursements already this year, and under the approved budget, another 5 percent cut is slated for October.
That lost hospital revenue will lead to higher prices for service and/or fewer hospital employees.
According to a recent economic analysis prepared for the Arizona Hospital and Healthcare Association by the W.P. Carey School of Business at Arizona State University, within one year, the budget cuts should result in the loss of 30,000 jobs statewide.
In Pima County alone, more than 2,400 health-care workers are expected to lose their employment, while 2,700 employees in other industries could be terminated because of the ripple effects of the cuts.
While most hospital representatives we contacted declined to comment on potential job cuts, Julia Strange at TMC observes: "Our current estimate is $20 million in lost revenue. That equates to 200 jobs."
For her part, Gov. Brewer believes something had to be done to rein in the state's rapidly rising health-care costs. In a January letter to members of the Legislature, she pointed out: "At the (budget) deficit's core is the explosive growth in Medicaid (AHCCCS) spending, which, over the last four years, has soared by almost 65 percent and now consumes 29 percent of our state budget."
We asked Brewer's office what poor people who will no longer be eligible for AHCCCS should do for health care after the budget takes effect, but we did not receive a response by our press deadline, even though the office was given a full week to come up with an answer.
Local physician Eve Shapiro, a longtime supporter of greater health-care access for the poor, backed 2000's Proposition 204, which expanded AHCCCS coverage. She believes the state budget violates that initiative's voter-approved provisions.
Shapiro expects that a lawsuit to overturn some of the health-care cuts will be filed by the end of the month—and she is optimistic it will succeed.
"This doesn't make any sense," Shapiro says about the budget reductions to health care, "because they don't save money in the end."