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Full Restoration of KidsCare Funding Expected

March 31, 2010

PHOENIX, Ariz. - The possible loss of $7 billion in federal Medicaid funding will force lawmakers and the governor to bring back the state's health program for uninsured children. That's the prediction of Children's Action Alliance president Dana Naimark, who says forfeiting all that federal money would bring unthinkable results.

"It would do huge, unbelievable damage to our economy and our health care system, and to the health of families throughout the state."

The possibility arose when lawmakers adopted a budget earlier this month ending the KidsCare program on June 15th and cutting more than 300,000 adults from AHCCCS (Access), the state's Medicaid program. The cuts appear to violate "maintenance of effort" requirements to continue receiving federal health care dollars.

Naimark says there are many options for raising the $20 million needed to restore KidsCare, including ending an outdated tax credit for retailers.

"Long ago when it was created, it was sort of in exchange for them collecting sales taxes. That was when things were not electronic, and it was more of a burden for them to collect and remit the sales taxes to the state."

She says the state is also in line for additional federal matching funds, which Congress is expected to approve in the coming weeks.

Noting that KidsCare pulls down nearly three federal dollars for every state dollar, Naimark says the program should be fully restored.

"We have had a freeze on KidsCare since December, where they're not letting in any new applicants, even when they qualify. So now it is time to bring KidsCare all the way back, so we are not shutting the door on uninsured kids who need health care."

Arizona is currently the only state to have repealed its federally-funded children's health insurance program.


Doug Ramsey, Public News Service - AZ