Arizona and the country are facing a crucial moment. The nonprofits across the state that have been awarded federal contracts to provide vital services to members of our communities are on edge as they wait to see if federal contracts and grants will be rescinded or if they can continue to provide services to our neighbors.

These are the same neighbors who may also lose another vital lifeline to their overall well-being: Medicaid enrollment.

This week, the U.S. House of Representatives voted on a budget resolution that seeks billions of dollars in cuts to federal spending.  The resolution calls for cuts of $880 billion over the next decade from the House Energy and Commerce Committee, which oversees health care spending programs, including Medicaid and Medicare. The committee must now develop ways to reach the $880 billion number, and Medicaid, which provides health coverage to millions of Americans, could be one of the places where cuts are seen. The program is funded jointly by states and the federal government and administered according to federal requirements. In Arizona, the agency tasked with administering Medicaid is the Arizona Health Care Cost Containment System (AHCCCS).

Who Does AHCCCS Currently Cover?

Currently, 2,035,693 Arizonans are covered by AHCCCS, including eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities. However, Arizona’s urban-rural divide is the largest of any state in the U.S. Thirty-six percent of rural Arizonans are covered by AHCCCS, compared to 17 percent in urban areas. Nationally, nearly 41 percent of children in small towns and rural areas rely on Medicaid for their coverage, compared to about 38 percent in metro areas. Among adults younger than 65, about 18 percent of those in small towns and rural America get their coverage through Medicaid, compared to about 16 percent in metro areas. The gaps show just how vital AHCCCS is for rural populations in Arizona.

Where would the cost cuts come from?

One way to cut federal contributions for Medicaid would be to decrease the “expansion population.”  This group consists of individual adults without children who earn at or below $21,597, according to the 2025 Federal Poverty Guidelines Chart. The Federal government currently matches 90 percent of the costs for these AHCCCS members in Arizona, while the state only has to kick in the remaining 10 percent. If this population is removed from eligibility in Arizona, up to 600,000 Arizonans could be cut from AHCCCS.

Another way to cut enrollment in Medicaid is to add work requirements. In Arizona, AHCCCS is currently seeking public comments on its upcoming works waiver request, which would require “Able-bodied adult” members to meet the following activities, or combination of activities, for at least 20 hours per week to qualify for AHCCCS: be employed; attend school; or attend an Employment Support and Development (ESD) program. The waiver also lists exemptions to the request. However, most adults on Medicaid (64 percent) are already working.

The Impacts of Potential Cuts

When people are not insured, they forego regular doctor visits, which can help find problems before they become acute conditions. Something that could have been prevented now becomes an ailment that takes much more to deal with: a larger medical team, higher medical bills, and there are impacts these conditions can have not only on the patient but on their families.

When a mother or father is told they are pre-diabetic during a yearly physical, they can change their lifestyle, and there is a chance to prevent worsening the condition. When that same parent doesn’t go to the doctor, pre-diabetes becomes diabetes, a chronic condition that now requires medication like insulin, which, if not taken, can lead to worse effects, like amputation or vision loss. These impacts then compound as they impact other family members and others who depend on them, like employers.

Leaving members of our community without health insurance will cause additional strain on an already strained health care system. Without access to care, many community members will use emergency rooms as their go-to medical care, even when they cannot pay. This is a double-edged sword as it will put families in financial hardship and leave hospitals to foot the bill for care they are mandated to provide and for which they may not be reimbursed.

What Can We Do?

Since the House of Representatives still has to find where to make cuts, and the Senate is working on its own version, there is still time to make your voice heard. We can all call our Federal elected officials and tell them it is in Arizona’s best interest to keep current members on AHCCCS and not create barriers to access to care. You can find your representative here.