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Connection Newsletter
By AzHHA Communications ● March 19, 2025
Smart Brevity® count: 8 mins...2102 words
This week, read about:
- A packed week at the Arizona Capitol.
- AHCCCS publishing its final notice for CYE 2026 DAP initiatives.
- CMS proposing significant programmatic changes for ACA Marketplace plans.
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A packed week at the Arizona Capitol
This week marked 67 days of the legislative session, with a substantial amount of work still ahead.
- Agendas were packed as legislators raced to get their bills heard in committee before the Friday, March 28, 2025 deadline.
Key legislative updates impacting hospitals: The AzHHA Policy and Advocacy team was active at the Capitol, providing testimony on three critical bills—all of which successfully passed out of their respective committees.
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HB2175 – claims; prior authorization; conduct
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✅ Passed Senate Finance Committee (5-2).
- Prohibits the use of artificial intelligence to deny claims or prior authorizations involving medical necessity, experimental status or other determinations requiring medical judgment.
- Requires an individual review by a licensed provider.
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🔗 Watch the testimony here.
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SB1219 – Behavioral health facilities and accreditation
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✅ Passed House Health and Human Services Committee (11-0).
- Mandates outpatient treatment centers to include a sober living home’s license number or name on intake forms.
- Requires the Arizona Department of Health Services to display its priority matrix for complaints publicly.
- Establishes an annual training program for surveyors.
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🔗 Watch the testimony here.
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SB1291 – Health insurers, provider credentialing and claims
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✅ Passed House Health and Human Services Committee (11-0).
- Reduces the time insurers can take to credential a provider for commercial plans.
- Allows retroactive payment back to the date the insurer confirmed receipt of a completed credentialing application.
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🔗 Watch the testimony here.
What’s next: Next week is the final opportunity for bills to be heard in committee, and we anticipate long agendas—some committees may even hold a second meeting before the Friday, March 28, 2025 deadline.
- Many of AzHHA’s priority bills have successfully advanced, and floor votes on the bills above could happen as early as next week.
Stay tuned for further updates as we continue advocating for Arizona’s hospitals and healthcare community.
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AHCCCS publishes its final notice for CYE 2026 DAP initiatives
Earlier this week, the Arizona Health Care Cost Containment System (AHCCCS) posted its Differential Adjusted Payment (DAP) final public notice for contract year ending (CYE) 2026 (Oct. 1, 2025 through Sept. 30, 2026).
- Although AzHHA submitted comments on the proposed DAP initiatives, AHCCCS decided not to make changes to its initial proposal.
Why it matters: Hospitals may receive additional AHCCCS funding for the following initiatives:
- Health information exchange (HIE) participation
- Social determinants of health (SDOH) closed loop referral system
- Naloxone Distribution Program (for hospitals with an emergency department that did not participate in CYE 2024)
- Maternal Syphilis Program (for hospitals with an emergency department)
- Medications for Opioid Use Disorder Enhancement Program (excluding long-term acute care hospitals and rehabilitation hospitals)
Additionally, long-term acute care hospitals and rehabilitation hospitals may receive a pressure ulcer funding DAP.
In order to be eligible for DAP payments, hospitals must meet a number of deadlines beginning on Tuesday, April 1, 2025.
- To ensure that your organization receives the HIE and/or SDOH DAP payments, it is essential to first submit the participant list form, which should have been provided by your Contexture quality improvement advisor.
- This is the initial step required to receive your statement of work via DocuSign.
- The statement of work encompasses all Contexture programs and must be executed no later than Tuesday, April 1, 2025.
- To participate in the Naloxone Distribution Program (NDP), Maternal Syphilis Program (MSP) or Medications for Opioid Use Disorder (MOUD) Enhancement Program, eligible hospitals must submit a letter of intent (LOI) to [email protected] no later than Tuesday, April 1, 2025.
Comments or questions? Please email AzHHA’s Director of Financial Policy and Reimbursement Amy Upston.
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CMS proposes significant programmatic changes for ACA Marketplace plans
On Monday, March 10, 2025, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that would make significant programmatic changes to Affordable Care Act (ACA) health insurance marketplaces.
Why it matters: CMS proposes to intensify income and eligibility verification processes, modify eligibility redetermination procedures, shorten the annual enrollment period by one month and eliminate the special enrollment period (SEP) for persons with annual household incomes below 150% of the federal poverty level.
- CMS’s stated goal is “to stabilize the risk pool, lower premiums and reduce improper enrollments with a goal of improving healthcare affordability and access while maintaining fiscal responsibility.”
Critics of the proposed rule believe the additional verification requirements would create substantial barriers for Americans attempting to enroll or re-enroll in an ACA Marketplace plan, to prove they are eligible for subsidies or to qualify for SEPs.
- Furthermore, shortening the annual enrollment period from Nov. 1 – Jan. 15 to Nov. 1 – Dec. 15 and eliminating certain SEPs would significantly reduce opportunities to sign up for coverage.
- If the regulation is implemented as proposed, CMS estimates that between 750,000 and two million people will lose coverage and spending on ACA subsidies will be reduced by $11 billion.
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Dr. Oz’s remarks on Medicaid, Medicare Advantage and rural hospitals
At his Senate confirmation hearing on Friday, March 14, 2025, Mehmet Oz, MD, President Trump’s nominee to lead the Centers for Medicare and Medicaid Services (CMS), dodged questions about whether he supports significant cuts to Medicaid as contemplated in the House budget resolution.
- Dr. Oz did not offer assurances of protecting Medicaid funding and instead asserted that "[t]he way you protect Medicaid is by making sure it is viable on every level."
- However, Dr. Oz explicitly supported states imposing Medicaid work requirements and included that he would support alternative options such as being enrolled in an educational program.
In stark contrast to Dr. Oz’s previous support of Medicare Advantage (MA), he roundly criticized the program at the hearing.
- Dr. Oz referred to widespread fraud in the program, such as insurers “upcoding” in order to boost profits.
- He promised to increase scrutiny of the program and root out wasteful spending, stating "[t]here's a new sheriff in town.”
- Previously, Dr. Oz had advocated for bolstering MA and potentially privatizing Medicare.
In response to several senators discussing the closure of rural hospitals in their states, Dr. Oz suggested that rural hospitals form partnerships with large hospitals in nearby cities.
- He asserted that “[w]e have to revisit how we deliver rural care in America,” and “[w]e can’t depend on 100-bed hospitals that do one delivery a day to provide state-of-the-art care.”
More generally, Dr. Oz discussed his agenda to combat waste, fraud and abuse, use artificial intelligence for prior authorization and to ease administrative burdens on providers and to give patients more information to navigate the healthcare system.
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Medicare Advantage overpayments estimated at $84B annually
Last week, MedPAC, which advises Congress on Medicare issues, published a report.
- The report estimates that the Centers for Medicare and Medicaid Services (CMS) spends an additional $84 billion annually on individuals who are enrolled in Medicare Advantage (MA) plans than they would if these individuals were instead enrolled in the traditional Medicare program.
Why it matters: From 2018 to 2024, the number of Medicare beneficiaries nationwide choosing to enroll in Medicare Advantage grew from 37% to 54%. In Arizona, the MA penetration rate was 51% in 2024.
Digging deeper: MedPAC identifies two main drivers of the overpayment: favorable selection and coding intensity.
- Favorable selection occurs when MA beneficiaries spend less than those in traditional Medicare with similar risk scores.
- Coding intensity refers to MA plans reporting more diagnosis codes than those with similar health in traditional Medicare.
Since CMS reimburses MA plans based on risk scores, MA plans, which report higher levels of diagnosis codes, will receive larger payments.
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Make a difference: Donate to the AzHHA PAC
Every day, elected officials’ decisions affect the health of Arizona’s people, patients and communities.
- The AzHHA PAC ensures strong healthcare advocacy at the Arizona Capitol.
Why it matters: Your support helps elect leaders who prioritize policies that benefit Arizona hospitals, providers and communities.
- Our engagement is successful because of your contributions to our PAC. This allows us to support and build relationships with healthcare and hospital-friendly legislators.
The big picture: We are more than 60 days into the legislative session, and we’ve engaged with more than 160 healthcare-related bills.
- Contributions to the AzHHA PAC strengthen our collective voice and impact.
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Healthcare Leadership Academy starts 2025 cohort!
Last week, the Healthcare Leadership Academy kicked off its 2025 cohort with 20 up-and-coming healthcare leaders.
- This group encompasses healthcare leaders from all across the state representing various disciplines including finance, laboratory, marketing, human resources, IT, pharmacy, nursing, ED and perioperative services.
Why it matters: The primary goal of the Healthcare Leadership Academy is to cultivate leadership in the hospital environment such that tomorrow’s C-suite is prepared to provide vision, articulate and live organization purpose, and promote operational and clinical innovation.
The big picture: The AzHHA Foundation partners with Creighton University to offer this program.
- Intended to foster tomorrow’s executive team, the Healthcare Leadership Academy is offered to mid-level employees of AzHHA member hospitals to prepare them for leadership positions.
Welcome to the 2025 cohort!
Questions? Please email [email protected].
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AHA workshop on community health and the environment
The American Hospital Association (AHA) is leading a new initiative focused on providing resources to support hospitals’ efforts to assess, plan and respond to the community health impacts of environmental conditions.
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As part of this effort, AHA is holding a series of seven workshops across the country to gather practitioners in this space and better understand opportunities and challenges related to addressing community health and the environment.
Why it matters: These workshops bring together frontline hospital leaders in community health strategy, population health and emergency planning in their prospective metro areas/regions.
What’s next: One of these workshops will take place in Scottsdale on Wednesday, May 13, 2025.
- If you or a colleague are interested in participating in this full-day, interactive workshop, please contact Sean Thornton, program manager, population health or Andrew Jager, senior director, population health.
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Member spotlight: TMC Health
TMC Health is strengthening its commitment to comprehensive cancer care by joining with the physicians of Tucson Oncology to create the TMC Health Cancer Center.
Why it matters: The new center is designed to enhance collaboration, streamline patient care and expand access to comprehensive cancer treatments across Southern Arizona.
The big picture: The network will:
- Foster seamless coordination among cancer specialists, primary care providers and TMC Health.
- Support patients and their families throughout every stage of the cancer journey, from diagnosis and treatment to survivorship.
- Provide world class care close to home.
- Advance cancer research and innovation by leveraging the expertise of TMC Health and Arizona Oncology and expanding access to groundbreaking clinical trials.
- Expand locations and accessibility by integrating multiple outpatient centers with inpatient services.
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Thursday, April 3 - AzPHA Annual Conference
This year’s conference theme is “building an innovative and inclusive infrastructure for the public health of the future” and will feature topics such as using AI to enhance public health practice and population outcomes, data infrastructure and informatics, public health workforce and engaging public health professionals. Register now.
April 15-16 - 2025 Arizona Immunization Conference
This one-of-a-kind event provides education and resources so you can better understand the challenges around vaccine confidence and leave the conference encouraged by the success stories from around the state. Join over 500 attendees at the 2025 conference. Register here.
May 4-6 - American Hospital Association Annual Membership Meeting
This event will feature insightful conversations with policymakers, legislators and thought leaders on our most pressing issues. You’ll connect with decision makers who create, shape and implement healthcare policy and influence the political landscape. Register now.
Wednesday, May 28 - Introduction to POLST
Join physician orders for life-sustaining treatment (POLST) paradigm for their one-hour virtual workshops equipping healthcare professionals with knowledge and resources to begin using POLST in Arizona. Register here.
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