GOV. JAN BREWER'S $541 MILLION GAMBLE

posted by Michael Chihak

Gov. Jan Brewer is seeking to balance the 2011-12 state budget by tightening the eligibility rules for the state's health-care program for the poor, called AHCCCS. In most states, it is Medicaid, funded largely by the federal government.

Reduced eligibility would save the state $541 million next fiscal year, Brewer says, whole dropping 280,000 adults from state-supported health care. Where they will go for health care, what the effects will be on hospital emergency rooms and other facilities and what the overall economic effects will be are questions yet to be answered.

But one thing is known, having come clear in an interview for Friday's Arizona Week broadcast: if Arizona gets federal approval to cut $541 million, it stands to lose more than $1 billion in federal matching money. So the reduction is much larger than it looks on the face of Brewer's budget. That was brought forth by Kristin Borns, senior policy analyst at the Morrison Institute for Public Policy at Arizona State University.

Some have suggested that if Arizona doesn't get the federal waiver, it should consider dropping its participation in Medicaid altogether, hearkening back to a time decades ago when the state declined to participate in the beginning days of the program.

If the state were to drop its participation, it would risk the loss of $7 billion in federal matching money for health care for the poor, leaving them, the state's hospitals and many small businesses in dire straits.