AZ Legislative Update – April 25, 2025
Posted by [email protected] on Apr. 28, 2025 / Subscribe 0
The Arizona 57th Legislature, 1st Regular Session reached the 100-day mark earlier this week with no sign of a budget agreement. Despite no pending deal on the budget, the Legislature and Governor Hobbs did reach a bipartisan agreement to fix the $122 million budget hole for the state’s disability services program on late Wednesday night. The agreement also means an end to the Governor’s bill moratorium.
The Division of Developmental Disabilities (DDD) was set to run out of money next week, threatening services for nearly 60,000 Arizonans. Without additional funding, the program would not have been able to pay claims or offer services until the state’s new budget year, starting in July.
The bipartisan resolution pulled all of the supplemental funding for DDD from the prescription drug rebates fund, as Hobbs and Democrats wanted. It also adjusted the proposed requirement for legislative approval of Medicaid waivers, except in certain cases. The original GOP plan cut the number of weekly hours for the Parents as Paid Caregivers program. That provision was removed; however, to appease Republicans, the bill now includes some reforms to that program, and it funds a special audit of it.
Moving forward, as the June 30th fiscal deadline looms, the bipartisan deal on the DDD supplemental bill could be a good sign for further cooperation on the FY 2026 budget.
Of the 1,679 bills introduced this year, the Legislature has now passed 145 bills with the Governor signing 93 and vetoing 52.
Health Insurance
HB 2125 Insurance Coverage; Hearing Aids; Children (Willoughby): HB 2125 passed out of the Senate Committee of the Whole on Tuesday. The bill requires a health care services organization that issues, amends, delivers or renews evidence of coverage to provide full coverage for any hearing aid and related service for an enrollee who is under 18 years old or 21 years old if the enrollee is still attending high school. HB 2125 allows a health care services organization to make available to the enrollee the option of purchasing additional hearing aid coverage that exceeds the described services. The bill requires hearing aid coverage to include fitting and dispensing services, providing ear molds as necessary to maintain optimal fit and any related services as provided by a licensed health care provider. It excludes short-term travel, accident-only, limited or limited benefit coverage from the hearing aid coverage requirements. The bill specifies that coverage for hearing aids may be subject to deductibles and coinsurance consistent with those imposed on other benefits under the same evidence of coverage. HB 2125 applies the hearing aid coverage requirements to any evidence of coverage issued with an effective date of December 31, 2025.
HB 2175 Prior Authorization; Claims (Willoughby): HB 2175 will be 3rd Read on Tuesday. The bill adds new requirements for health care insurers regarding the denial of claims and prior authorizations. Specifically, it stipulates that before a health care insurer may deny a claim or prior authorization, submitted by a provider, on the basis and involving medical necessity, the medical director shall individually review the denial. During each review, the medical director shall exercise independent medical judgement and may not rely solely on recommendations from any other source.
HB 2109 Forced Organ Harvesting; Insurance; Prohibition (Biasiucci): HB 2109 will be 3rd Read on Tuesday. The bill allows insurers and the Arizona Health Care Cost Containment System to limit coverage for human organ transplants or post-transplant care if the transplant operation is performed in, or the human organ to be transplanted was procured by a sale or donation originating in the People's Republic of China or the Hong Kong Special Administrative Region.
HB 2332 Postpartum Health; Education; Advisory Committee (Willoughby): HB 2332 will be 3rd Read on Tuesday. The bill requires the Department of Health Services to compile relevant educational materials and information regarding maternal mental health conditions, including postpartum depression, for use by health care institutions, health care professionals and patients and to establish an Advisory Committee on Obstetrics, Gynecology and Maternal Mental Health in Rural Communities.
HB 2945 Development Disabilities; Appropriations; Waivers (Livingston): HB 2945 was signed by the Governor on Thursday. This emergency measure appropriates substantial funds for developmental disabilities Medicaid programs and instituting new requirements for the Parents as Paid Caregivers (PPCG) Program. Specifically, it would appropriate $109,200,300 from the Prescription Drug Rebate Fund and $403,000,000 in developmental disabilities Medicaid expenditure authority for FY 2025 to the Arizona Department of Economic Security (DES) for Medicaid Program expenses. Additionally, it would require DES to implement a weekly cap of 40 hours of care services per child under the PPCG Program and establish an electronic visit verification system. The bill also prohibits parents from billing for services when the child is not present and restricts billing for tasks typically performed by a parent of a child without disabilities, while mandating legislative approval for any new waiver amendment proposals by AHCCCS that expand eligibility or add new services. Moreover, the bill introduces new reporting requirements for state agencies, including the Arizona Health Care Cost Containment System (AHCCCS) notifying the Joint Legislative Budget Committee (JLBC) of waiver applications at the time of public comment. It eliminates existing reporting obligations for the Director of OSPB concerning federal grants-in-aid and instructs the Auditor General to conduct a special audit of the PPCG Program, with an appropriation of $355,000 for this purpose. The bill also establishes new definitions and mandates quarterly reports on service utilization, while requiring a standardized assessment tool for determining care needs by October 1, 2025. This act is classified as an emergency measure, taking effect immediately upon passage.
SB 1291 Health Insurers; Provider Credentialing; Claims (Angius): SB 1291 will be Final Read in the Senate on Tuesday. The bill would update the Arizona Revised Statutes by introducing new requirements and timelines for the health insurance provider credentialing process. Specifically, it mandates that health insurers complete the credentialing process within 60 calendar days and load applicant information into their billing systems within 30 days of receiving a complete application. Insurers would also be required to acknowledge receipt of applications within seven days and provide detailed notices for any incomplete applications, informing applicants within the same timeframe. The bill further stipulates that insurers cannot toll the processing time more than three times for incomplete applications. Additionally, the bill modifies existing definitions and repeals section 20-3456, establishing new provisions that allow providers to receive payment for services rendered during the credentialing process under certain conditions. Claims submitted within one year cannot be denied based on timing if they meet the new statutory requirements. The bill also emphasizes the need for health care providers to disclose their credentialing status and estimated costs to patients prior to service delivery.
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