Arizona Working to Reduce Number of Uninsured

August 31, 2006

HealthLeaders-InterStudy, a provider of managed care industry intelligence, reports that the state of Arizona is responding to its population boom with new initiatives to reduce the number of uninsured. According to the Phoenix Market Overview, a proposed amendment to the state Medicaid program and new legislative efforts are targeting changes that would prove favorable for the small business sector.

“With the population growth in Arizona, action is being taken to address the growing number of uninsured lives,” according to HealthLeaders-InterStudy Senior Analyst Patrick Powers. “Lawmakers are responding with tax credits for small businesses that provide insurance to their employees and creating additional incentives for those who currently do not.”

Small businesses dominate the landscape in Arizona, with nearly 400,000 small businesses statewide. The majority have fewer than 25 workers and only 28 percent offer employer-sponsored health insurance.

Arizona Medicaid is seeking an amendment to its Section 1115 waiver to expand healthcare to employees of small businesses, targeting employers with between two and 25 employees who pay at least half of their workers’ health premiums. Designed for workers who earn less than 200 percent of the federal poverty level, the program would not cap out-of-pocket expenses and not extend coverage to workers’ dependents or family members.

A new bill signed into law in June 2006 (HB 2177) is expected to provide health insurance to 5,000 uninsured Arizonans. This program, estimated to cost $5 million, will provide discounts to insurers that cut their rates for individuals and small businesses that do not have coverage.

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