Common use of PROGRAM OVERVIEW AND HISTORICAL CONTEXT Clause in Contracts

PROGRAM OVERVIEW AND HISTORICAL CONTEXT. Until 1982, Arizona was the only state that did not have a Medicaid program under title XIX of the Social Security Act. In October 1982, Arizona implemented the AHCCCS in the state’s first section 1115 demonstration project. AHCCCS initially covered only acute care services, however, by 1989, the program was expanded to include the Arizona Long Term Care System (ALTCS), the state’s capitated long term care (LTC) program for the elderly and physically disabled (EPD) and the developmentally disabled (DD) populations. In 2000, the state also expanded coverage to adults without dependent children with family income up to and including 100 percent of the Federal poverty level (FPL) as well as established the Medical Expense Deduction (MED) program for adults with income in excess of 100 percent of the FPL who have qualifying healthcare costs that reduce their income at or below 40 percent of the FPL. On March 31, 2011, Arizona requested to terminate its initial section 1115 demonstration in order to eliminate the MED program and implement an enrollment freeze on the adults without dependent children population. On April 30, 2011, and July 1, 2011, CMS approved the state’s required phase-out plans for the MED program and the adults without dependent children population, respectively. The new demonstration provides health care services through a prepaid, capitated managed care delivery model that operates statewide for both Medicaid state plan groups as well as demonstration expansion groups. The goal of the demonstration is to test health care delivery systems to provide organized and coordinated health care for both acute and long term care that include pre-established provider networks and payment arrangements, administrative and clinical systems for utilization review, quality improvement, patient and provider services, and management of health services. The demonstration will also test the extent to which health outcomes in the overall population are improved by expanding coverage to additional needy groups. The demonstration affects coverage for certain specified mandatory state plan eligibles by requiring enrollment in coordinated, cost effective, health care delivery systems. In this way, the demonstration will test the use of managed care entities to provide cost effective care coordination, including two pilot projects that will test the effect of integrating behavioral and physical health services for two populations– individuals residing in Maricopa county and Greater Arizona with serious mental illness and children participating in the Children’s Rehabilitative Services program. In addition, the demonstration will provide for payments to IHS and tribal 638 facilities to address the fiscal burden of uncompensated care for certain services not covered under the state plan and provided in or by such facilities. This authority will enable the state to evaluate how this approach impacts the financial viability of IHS and 638 facilities and ensures the continued availability of a robust health care delivery network for current and future Medicaid beneficiaries.

PROGRAM OVERVIEW AND HISTORICAL CONTEXT. Until 1982, Arizona was the only state State that did not have a Medicaid program under title XIX of the Social Security Act. In October 1982, Arizona implemented the AHCCCS in the stateState’s first section 1115 demonstration project. AHCCCS initially covered only acute care services, however, by 1989, the program was expanded to include the Arizona Long Term Care System (ALTCS), the stateState’s capitated long term care (LTC) program for the elderly and physically disabled (EPD) and the developmentally disabled (DD) populations. In 2000, the state State also expanded coverage to adults without dependent children with family income up to and including 100 percent of the Federal poverty level (FPL) as well as established the Medical Expense Deduction (MED) program for adults with income in excess of 100 percent of the FPL who have qualifying healthcare costs that reduce their income at or below 40 percent of the FPL. On March 31, 2011, Arizona requested to terminate its initial section 1115 demonstration in order to eliminate the MED program and implement an enrollment freeze on the adults without dependent children population. On April 30, 2011, and July 1, 2011, CMS approved the stateState’s required phase-out plans for the MED program and the adults without dependent children population, respectively. The new demonstration Demonstration provides health care services through a prepaid, capitated managed care delivery model that operates statewide for both Medicaid state State plan groups as well as demonstration Demonstration expansion groups. The goal of the demonstration Demonstration is to test health care delivery systems to provide organized and coordinated health care for both acute and long term care that include pre-established provider networks and payment arrangements, administrative and clinical systems for utilization review, quality improvement, patient and provider services, and management of health services. The demonstration Demonstration will also test the extent to which health outcomes in the overall population are improved by expanding coverage to additional needy groups. The demonstration Demonstration affects coverage for certain specified mandatory state State plan eligibles by requiring enrollment in coordinated, cost effective, health care delivery systems. In this way, the demonstration Demonstration will test the use of managed care entities to provide cost effective care coordination. The Demonstration also provides coverage to limited groups the State does not currently cover under its Medicaid State plan, including two pilot projects that adults without dependent children, and a limited number of children with incomes above the levels under the Medicaid State plan and at or below 175 percent of the FPL, which will test show the effect benefits of integrating behavioral and physical health services for two populations– individuals residing in Maricopa county and Greater Arizona with serious mental illness and children participating in the Children’s Rehabilitative Services programsuch coverage using these approaches to a wider population. In addition, the demonstration Demonstration will provide for payments to IHS and tribal 638 facilities to address the fiscal burden of uncompensated care for certain services not covered under the state plan and provided in or by such facilitiesfacilities to individuals with income up to 100 percent of the FPL. This authority will enable the state State to evaluate how this approach impacts the financial viability of IHS and 638 facilities and ensures the continued availability of a robust health care delivery network for current and future Medicaid beneficiaries. Finally, the Demonstration will allow the State to also test the effects of increasing personal financial responsibility on utilization and health outcomes on some populations by permitting cost sharing. Specifically, the Demonstration will test the effects of the imposition of mandatory co-payments on adults without dependent children in the following areas: 1. Utilization of needed preventive, primary care, and treatment services; 2. Appropriate utilization of emergency room care, and appropriate, cost and clinically effective use of generic and brand name drugs; 3. State and Federal expenditures (per enrollee) in the short and long term; and 4. Physician participation, including physician willingness to accept appointments from the adults without dependent children population. In order to evaluate these hypotheses, the Demonstration will review utilization and cost data and quality measures related to the adults without dependent children enrolled under the Demonstration as specified in paragraph 28(c).

PROGRAM OVERVIEW AND HISTORICAL CONTEXT. Until 1982, Arizona was the only state State that did not have a Medicaid program under title XIX of the Social Security Act. In October 1982, Arizona implemented the AHCCCS in the stateState’s first section 1115 demonstration project. AHCCCS initially covered only acute care services, however, by 1989, the program was expanded to include the Arizona Long Term Care System (ALTCS), the stateState’s capitated long term care (LTC) program for the elderly and physically disabled (EPD) and the developmentally disabled (DD) populations. In 2000, the state State also expanded coverage to adults without dependent children with family income up to and including 100 percent of the Federal poverty level (FPL) as well as established the Medical Expense Deduction (MED) program for adults with income in excess of 100 percent of the FPL who have qualifying healthcare costs that reduce their income at or below 40 percent of the FPL. On March 31, 2011, Arizona requested to terminate its initial section 1115 demonstration in order to eliminate the MED program and implement an enrollment freeze on the adults without dependent children population. On April 30, 2011, and July 1, 2011, CMS approved the stateState’s required phase-out plans for the MED program and the adults without dependent children population, respectively. The new demonstration Demonstration provides health care services through a prepaid, capitated managed care delivery model that operates statewide for both Medicaid state State plan groups as well as demonstration Demonstration expansion groups. The goal of the demonstration Demonstration is to test health care delivery systems to provide organized and coordinated health care for both acute and long term care that include pre-established provider networks and payment arrangements, administrative and clinical systems for utilization review, quality improvement, patient and provider services, and management of health services. The demonstration Demonstration will also test the extent to which health outcomes in the overall population are improved by expanding coverage to additional needy groups. The demonstration Demonstration affects coverage for certain specified mandatory state State plan eligibles by requiring enrollment in coordinated, cost effective, health care delivery systems. In this way, the demonstration Demonstration will test the use of managed care entities to provide cost effective care coordination, including two pilot projects that will test the effect of integrating behavioral and physical health services for two populationspopulations – individuals residing in Maricopa county and Greater Arizona with serious mental illness and children participating in the Children’s Rehabilitative Services program. The Demonstration also provides coverage to limited groups the State does not currently cover under its Medicaid State plan, including adults without dependent children, and a limited number of children with incomes above the levels under the Medicaid State plan and at or below 200 percent of the FPL, which will show the benefits of such coverage using these approaches to a wider population. In addition, the demonstration Demonstration will provide for payments to IHS and tribal 638 facilities to address the fiscal burden of uncompensated care for certain services not covered under the state plan and provided in or by such facilitiesfacilities to individuals with income up to 100 percent of the FPL. This authority will enable the state State to evaluate how this approach impacts the financial viability of IHS and 638 facilities and ensures the continued availability of a robust health care delivery network for current and future Medicaid beneficiaries. Finally, the Demonstration will allow the State to also test the effects of increasing personal financial responsibility on utilization and health outcomes on some populations by permitting cost sharing. Specifically, the Demonstration will test the effects of the imposition of mandatory co-payments on adults without dependent children in the following areas: 1. Utilization of needed preventive, primary care, and treatment services; 2. Appropriate utilization of emergency room care, and appropriate, cost and clinically effective use of generic and brand name drugs; 3. State and Federal expenditures (per enrollee) in the short and long term; and 4. Physician participation, including physician willingness to accept appointments from the adults without dependent children population. In order to evaluate these hypotheses, the Demonstration will review utilization and cost data and quality measures related to the adults without dependent children enrolled under the Demonstration as specified in paragraph 29(c).

PROGRAM OVERVIEW AND HISTORICAL CONTEXT. Until 1982, Arizona was the only state State that did not have a Medicaid program under title XIX of the Social Security Act. In October 1982, Arizona implemented the AHCCCS in the stateState’s first section 1115 demonstration project. AHCCCS initially covered only acute care services, however, by 1989, the program was expanded to include the Arizona Long Term Care System (ALTCS), the stateState’s capitated long term care (LTC) program for the elderly and physically disabled (EPD) and the developmentally disabled (DD) populations. In 2000, the state State also expanded coverage to adults without dependent children with family income up to and including 100 percent of the Federal poverty level (FPL) as well as established the Medical Expense Deduction (MED) program for adults with income in excess of 100 percent of the FPL who have qualifying healthcare costs that reduce their income at or below 40 percent of the FPL. On March 31, 2011, Arizona requested to terminate its initial section 1115 demonstration in order to eliminate the MED program and implement an enrollment freeze on the adults without dependent children population. On April 30, 2011, and July 1, 2011, CMS approved the stateState’s required phase-out plans for the MED program and the adults without dependent children population, respectively. The new demonstration Demonstration provides health care services through a prepaid, capitated managed care delivery model that operates statewide for both Medicaid state State plan groups as well as demonstration Demonstration expansion groups. The goal of the demonstration Demonstration is to test health care delivery systems to provide organized and coordinated health care for both acute and long term care that include pre-established provider networks and payment arrangements, administrative and clinical systems for utilization review, quality improvement, patient and provider services, and management of health services. The demonstration Demonstration will also test the extent to which health outcomes in the overall population are improved by expanding coverage to additional needy groups. The demonstration Demonstration affects coverage for certain specified mandatory state State plan eligibles by requiring enrollment in coordinated, cost effective, health care delivery systems. In this way, the demonstration Demonstration will test the use of managed care entities to provide cost effective care coordination, including two pilot projects that will test the effect of integrating behavioral and physical health services for two populationspopulations – individuals residing in Maricopa county and Greater Arizona with serious mental illness and children participating in the Children’s Rehabilitative Services program. The Demonstration also provides coverage to limited groups the State does not currently cover under its Medicaid State plan, including adults without dependent children, and a limited number of children with incomes above the levels under the Medicaid State plan and at or below 175 percent of the FPL, which will show the benefits of such coverage using these approaches to a wider population. In addition, the demonstration Demonstration will provide for payments to IHS and tribal 638 facilities to address the fiscal burden of uncompensated care for certain services not covered under the state plan and provided in or by such facilitiesfacilities to individuals with income up to 100 percent of the FPL. This authority will enable the state State to evaluate how this approach impacts the financial viability of IHS and 638 facilities and ensures the continued availability of a robust health care delivery network for current and future Medicaid beneficiaries. Finally, the Demonstration will allow the State to also test the effects of increasing personal financial responsibility on utilization and health outcomes on some populations by permitting cost sharing. Specifically, the Demonstration will test the effects of the imposition of mandatory co-payments on adults without dependent children in the following areas: 1. Utilization of needed preventive, primary care, and treatment services; 2. Appropriate utilization of emergency room care, and appropriate, cost and clinically effective use of generic and brand name drugs; 3. State and Federal expenditures (per enrollee) in the short and long term; and 4. Physician participation, including physician willingness to accept appointments from the adults without dependent children population. In order to evaluate these hypotheses, the Demonstration will review utilization and cost data and quality measures related to the adults without dependent children enrolled under the Demonstration as specified in paragraph 28(c).

PROGRAM OVERVIEW AND HISTORICAL CONTEXT. Until 1982, Arizona was the only state that did not have a Medicaid program under title XIX of the Social Security Act. In October 1982, Arizona implemented the AHCCCS in the state’s first section 1115 demonstration project. AHCCCS initially covered only acute care services, however, by 1989, the program was expanded to include the Arizona Long Term Care System (ALTCS), the state’s capitated long term care (LTC) program for the elderly and physically disabled (EPD) and the developmentally disabled (DD) populations. In 2000, the state also expanded coverage to adults without dependent children with family income up to and including 100 percent of the Federal poverty level (FPL) as well as established the Medical Expense Deduction (MED) program for adults with income in excess of 100 percent of the FPL who have qualifying healthcare costs that reduce their income at or below 40 percent of the FPL. On March 31, 2011, Arizona requested to terminate its initial section 1115 demonstration in order to eliminate the MED program and implement an enrollment freeze on the adults without dependent children population. On April 30, 2011, and July 1, 2011, CMS approved the state’s required phase-out plans for the MED program and the adults without dependent children population, respectively. The new demonstration provides health care services through a prepaid, capitated managed care delivery model that operates statewide for both Medicaid state plan groups as well as demonstration expansion groups. The goal of the demonstration is to test health care delivery systems to provide organized and coordinated health care for both acute and long term care that include pre-established provider networks and payment arrangements, administrative and clinical systems for utilization review, quality improvement, patient and provider services, and management of health services. The demonstration will also test the extent to which health outcomes in the overall population are improved by expanding coverage to additional needy groups. The demonstration affects coverage for certain specified mandatory state plan eligibles by requiring enrollment in coordinated, cost effective, health care delivery systems. In this way, the demonstration will test the use of managed care entities to provide cost effective care coordination, including two pilot projects that will test the effect of integrating behavioral and physical health services for two populations– individuals residing in Maricopa county and Greater Arizona with serious mental illness and children participating in the Children’s Rehabilitative Services program. The demonstration also provides coverage to limited groups the state does not currently cover under its Medicaid state plan, including a limited number of children with incomes above the levels under the Medicaid state plan and at or below 200 percent of the FPL, which will show the benefits of such coverage using these approaches to a wider population. In addition, the demonstration will provide for payments to IHS and tribal 638 facilities to address the fiscal burden of uncompensated care for certain services not covered under the state plan and provided in or by such facilities. This authority will enable the state to evaluate how this approach impacts the financial viability of IHS and 638 facilities and ensures the continued availability of a robust health care delivery network for current and future Medicaid beneficiaries.