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Divided State Government Produces a Decent Public Health Budget

Arizona finally has a state budget agreement. Gov. Hobbs & Republican leaders from the Arizona House and Senate negotiated a compromise budget of nearly $18.3 billion for the fiscal year that begins July 1. In the end it passed with a coalition of some Dems and some Republicans.

Nobody got everything they wanted. From a public health perspective, the most important things to know are that AHCCCS and ADES got the funding and increased personnel counts to be in a better position to meet the  enormous administrative challenges they and their members (AHCCCS and SNAP) face because of H.R. 1.

AHCCCS and ADES will be getting about $21M more in state funds to hire more eligibility workers (who are essential to handing the avalanche of incoming H.R.1 red tape). The budget also funds for critical computer upgrades for both ADES and AHCCCS (essential for managing the paperwork burden members will face because of H.R.1. ADOA even got some money to help with the AHCCCS/ADES systems.

Most state agencies got a 2.5% reduction in their general fund operating line items – but ADHS, AHCCCS and ADES were exempt from those cuts.

The end of the session early Saturday morning was raucous. The session Saturday morning at 4:45 a.m. after a long night of rapid-fire voting. Republican lawmakers used the final hours to advance a series of conservative ballot referrals that will bypass Gov. Katie Hobbs and go directly to voters in November.

The measures include proposals affecting voting rules, red-light cameras, and passing a ballot referral that, if it passes, would negate the voter initiative that will put some financial guardrails on the ESA voucher giveaway. They also put a measure on the ballot that will make it a lot harder for people to vote by mail because they’d have to go in and prove who they are rather than using signature verification on the mail in ballot.

While the legislative session is over, many of the year’s most consequential policy debates have simply shifted to the November ballot.

AZ Legislature ends 2026 session after late-night GOP push to send conservative agenda to voters

AHCCCS: More Eligibility Staff & Better Computer Systems

H.R. 1 creates a barrage of new paperwork requirements for Medicaid agencies and their members. Beginning with renewals that start 1/1/27, most adults enrolled through the Medicaid expansion population will need to renew their eligibility every six months instead of once per year. That doubles the workload among those 500,000 members and AHCCCS eligibility workers.

On top of that, the same group (about 500,000 people) will need to document that they’re meeting the new federal work and community-engagement requirements or qualify for an exemption. Better software and hardware will be needed in order for people to be able to report their compliance and ADES and AHCCCS will need well over 100 more eligibility staff to process the redetermination applications.

You can read more about the federal requirements in our earlier post:
https://azpha.org/2026/06/08/cms-finally-defines-what-counts-toward-their-new-work-requirements/

AHCCCS will be getting $10.2M to help implement the H.R. 1 eligibility changes. Of that amount, $4M is specifically designated for information-technology upgrades. The budget also provides $12.9M to ADOA to continue replacing the AHCCCS mainframe system.

That investment is badly needed. AHCCCS will be expected to process more eligibility checks and help members navigate more complicated rules (work requirements). Trying to do that with outdated computer systems would be a recipe for failure. The biggest risk is not that large numbers of people will intentionally refuse to follow the new rules. The bigger risk is that eligible people will lose their health insurance because the paperwork is confusing, the notices are unclear or the computer systems do not work well enough.

I don’t really know whether this is enough money… but I do know it’s a big improvement from where we are today. Of course – it’ll be super critical for both ADES and AHCCCS to use this money wisely, be clear to IT contractors about what they want- and to hold them strictly accountable for timelines and quality testing. Now, on to ADES.

ADES: An Ancient Computer System & the Coming Paperwork Avalanche

ADES also got important resources in the compromise budget. They play a big role in processing eligibility for AHCCCS and SNAP.  They’re already under strain and will face more work when federal benefit rules become more complicated in January.

The budget provides ADES with $10.8M for SNAP error-rate reduction workload and $6.1M  for costs related to its “legacy” mainframe systems. “Legacy” is an unusually generous word choice. “Ancient” would be more accurate.

Arizona is asking ADES employees to administer increasingly complicated programs using computer systems that were designed in a different era. The new funding will not solve every problem, but it should help ADES hire more staff and begin addressing some of its most serious technology limitations.

• HB4154: General Appropriation Act Summary 

 

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The Healthcare BRB:

More State Level Eligibility Checks

The budget is not just a list of appropriations. It also includes budget reconciliation bills, or  BRBs. These bills amend state law that are connected to the budget.

The healthcare BRB has a long list of AHCCCS eligibility directives. Some are reasonable efforts to improve accuracy. Others will just create more administrative barriers for eligible members.

Here’s the condensed version of AHCCCS’ new responsibilities in the Health BRB. AHCCCS must:

• check lottery and gambling winnings, including online gambling winnings, when deciding eligibility.
• review death records, wage changes, employment information, unemployment benefits and evidence that a member may have moved out of state.
• review a member’s eligibility whenever it receives information suggesting that the person’s circumstances may have changed.
• not accept a person’s statement that they live in Arizona without independently verifying residency.
• may accept eligibility assessments from the federal health-insurance marketplace, but it must independently verify the information and make its own eligibility decision.
• may enter into agreements with other state agencies and contract with outside vendors to obtain more eligibility information.
• submit any necessary federal waiver requests to CMS by April 1, 2027.

Some of these data checks make sense. AHCCCS shouldn’t enroll someone who died, moved out of state or won the lottery.  But… every added verification requirement creates another opportunity for an eligible person to fall through the cracks, especially the provision that they can’t accept a person’s statement that they live in Arizona without independently verifying residency.

Hospital Presumptive Eligibility Narrows

The healthcare BRB also directs AHCCCS to ask the federal government for permission to narrow hospital presumptive eligibility.

Presumptive eligibility allows hospitals to temporarily enroll patients who appear eligible for AHCCCS while their full application is being processed. The BRB would limit that pathway primarily to only kids and pregnant women.

Dementia Planning and Newborn Screening

ADHS also got $700K for an Alzheimer’s disease and related dementia initiative. ADHS would become the lead state agency for dementia planning, coordinate programs across state agencies, engage stakeholders and regularly update Arizona’s Alzheimer’s Disease State Plan. There are a lot of details but $700K looks stingy for what they’re expected to do.

The budget also gives the state lab $755K in new money to add Duchenne muscular dystrophy to Arizona’s newborn screening panel (without needing to raise the newborn screening fees).

If you want to get more details, you can look at the following links:

• HB4160: Healthcare Budget Reconciliation Bill Summary

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Gritty Summary of the 2026 Legislative Session:

Public Health Wins, Vetoes and Bills Still on the Governor’s Desk

There were some meaningful public health wins this year. Several bills we supported made it through the Legislature and have already been signed by Gov. Katie Hobbs. A few other good bills are still sitting on her desk.

The governor also vetoed several bad bills, and we’re urging her to veto five more that passed during the final weeks of the session.

Several proposals we opposed died before they could reach the finish line. That includes HCR2056, the sweeping constitutional amendment that would have undermined school vaccine requirements and many other basic disease-control tools. That one was a major threat, and its failure is a public health victory.

Republican lawmakers did send three other measures we oppose directly to voters. Because ballot referrals bypass the governor, those fights will move to the November election.

Here’s the final rundown.

Ballot Referrals We Oppose — Headed to Voters in November

HCR2001 — Voting Restrictions

Makes early voting and voting by mail much more difficult. Among other changes, it would end the longstanding practice of using a voter’s signature as the primary method of verifying a mailed ballot and adding new identification hurdles. Status: On the November ballot

HCR2048 — ESA Expansion Disguised as a Military-Family Measure

The title makes this sound like a narrow proposal allowing children of former military service members to save unused Empowerment Scholarship Account funds for college. But the broader effect would be to block important ESA accountability reforms, including key provisions of the Protect Education Act if voters approve that citizen initiative. Status: On the November ballot

SCR1004 — Photo-Enforcement Ban

It would prohibit cities and towns from installing new photo-enforcement systems and make it difficult for communities with existing programs to keep them. The measure covers red-light cameras, not just speed cameras. Well-placed red-light cameras can prevent serious and deadly crashes at dangerous intersections. Status: On the November ballot

Good Bills We Supported — Passed & Signed

HB2176 — ADHS Licensing Reform

Prevents health-care facilities from evading accountability through “license swapping.” It also improves notice requirements and creates a clearer informal dispute-resolution process.

HB2177 — AHCCCS Services for Tribal Members

Restores AHCCCS waiver requests that it could provide more services to tribal members. Those requests were dropped in 2010.

HB2178 — State-Agency Chief Medical Officers

Requires chief medical officers working for state agencies to hold an active Arizona MD or DO license.

HB2195 — Skilled-Nursing Facility Oversight

Improves nursing-home licensing and oversight. It gives ADHS access to certain personnel records, requires faster delivery of statements of deficiencies and aligns complaint investigations with federal standards.

HB2673 — Mental-Health Screening in County Jails

Requires county jails to provide mental-health screening and ensure that people receive more assessments and treatment when called for.

HB2923 — Court-Ordered Treatment Judicial Review

Improves the judicial-review process for court-ordered treatment cases and creates clearer standards for courts and petitioners.

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Good Bills That Passed — We Hope the Governor Signs Them

HB2244 — Evictions and Satisfaction of Judgments

Makes a modest but useful improvement to the landlord-tenant system by addressing court-fee relief and the handling of satisfied eviction judgments.

SB1113 — Service of Process for Evaluation Agencies

Allow an evaluation agency to serve certain court documents when authorized by a judge. This should improve the administration of the court-ordered evaluation process.

SB1162 — Health-Care Licensing and Inspection Coordination

Directs ADHS and AHCCCS to coordinate oversight work and reduce duplicative inspections. It also allows ADHS to resolve some complaints and self-reports through off-site review. That should improve efficiency, but implementation will need to be monitored to ensure that off-site reviews don’t become superficial “windshield inspections.”

SB1165 — Breast-Cancer Screening Cost Sharing

Prohibits insurers from imposing cost-sharing requirements for preventive breast-cancer screening and more services needed to complete the screening process.

SB1247 — Assisted-Living Occupants

Allows a person who isn’t receiving services to live with someone in an assisted-living facility or assisted-living home when the facility agrees.

SB1564 — Electronic Monitoring in Long-Term Care

Requires assisted-living and skilled-nursing facilities to publicly disclose whether they allow residents, patients or families to install video-monitoring devices in rooms with the consent of the people living there.

Bad Bills We Opposed — Vetoed by the Governor

SB1051 — Hospital Immigration-Status Reporting

Would have required hospitals to ask patients about their immigration status, keep the information and report aggregate data. The measure risked discouraging people from seeking needed medical care.

HB2206 — SNAP Error-Rate Mandate

Would have required the Arizona Department of Economic Security to reduce its SNAP payment error rate to no more than 3% by 2030 and imposed additional audit and reporting requirements. The measure focused on punitive oversight at a time when ADES already faces major administrative burdens.

HB2396 — SNAP Waiver Request

Would have required ADES to request a federal waiver related to allowable SNAP purchases. The measure was poorly designed and would have added administrative work without a clear public-health benefit.

Bad Bills That Passed — We’re Urging the Governor to Veto Them

HB2086 — Vaccination and Mask Requirements

Would prohibit businesses and government entities from requiring masks or proof of vaccination in many circumstances. The bill is broad and unclear, and it could interfere with basic infection-control measures during outbreaks.

Status: On the governor’s desk — veto urged

HB2248 — Medical-Intervention Restrictions

Would prevent private businesses and other organizations from adopting vaccine requirements, including in some health-care settings. The Legislature shouldn’t be micromanaging the infection-control policies of private employers and medical facilities.

Status: On the governor’s desk — veto urged

HB2448 — SNAP Work-Requirement Waivers

Would prohibit ADES from requesting certain federal SNAP work-requirement waivers unless they are required by federal law or specifically authorized by state law. That would limit Arizona’s flexibility to respond to economic conditions and protect food access.

Status: On the governor’s desk — veto urged

SB1011 — Vaccination Status on Infant Death Certificates

Would require medical examiners investigating sudden infant deaths to check vaccination status and include that information on death certificates. The measure appears designed to fuel misinformation rather than improve the scientific investigation of infant deaths.

Status: On the governor’s desk — veto urged

SB1212 — Vaccine Reimbursement Restrictions

Would prevent health insurers from offering different vaccine-administration reimbursement rates based on whether providers meet vaccination benchmarks. That would interfere with incentive programs designed to improve vaccination rates.

Status: On the governor’s desk — veto urged

Good Bills We Supported — But They Died

HB2051 — AHCCCS Breastfeeding and Lactation Coverage

Would have improved AHCCCS coverage of inpatient and outpatient lactation services and addressed reimbursement gaps.

HB2064 — Vulnerable Pedestrian Safety

Would have strengthened protections for pedestrians and other vulnerable road users.

HB2194 — Prior-Authorization and Claim Denial Transparency

Would have required insurers to provide clear contact information explaining how patients and providers can appeal denied claims and prior-authorization decisions.

HB2214 — Skin-Cancer Prevention License Plate

Would have created a specialty license plate supporting nonprofit sun-safety education.

HB2224 — Produce Incentive Program

Would have proposed $2 million per year for produce incentives administered through ADES, helping families afford healthier food.

HB2228 — Elder-Abuse Registry Accountability

Would have strengthened accountability for reporting elder-abuse information from Adult Protective Services to the Attorney General’s Office.

HB2252 — Midwives and Ambulance Transport

Would have allowed midwives to go with patients in ambulances during hospital transfers when approved by the emergency medical services medical director.

HB2542 — Preventive Dental Care in AHCCCS

Would have allowed Arizona’s limited AHCCCS adult dental benefit to cover preventive services, not just emergencies.

HB2617 — Prostate-Cancer Screening

Would have required health plans to cover PSA screening without cost sharing for higher-risk men over age 40.

HB2683 — SNAP Contingency Funding

Would have provided $5 million to help keep SNAP benefits during a federal government shutdown.

HB2914 — Electronic Monitoring in Long-Term Care

Would have authorized families to install monitoring devices in assisted-living and skilled-nursing facilities when all residents of the room consented. AHCA kills this every year.

HB2958 — AHCCCS Dental Coverage During Pregnancy

Would have required AHCCCS to cover dental care for pregnant members, using prescription-drug rebate funds for the state match.

SB1082 — Petting-Zoo Hygiene

Would have required basic handwashing and supervision standards at petting zoos. Simple infection-control measures like these prevent avoidable illnesses.

SB1112 — Witnesses in Mental-Health Hearings

Would have allowed people familiar with a patient’s behavior to provide information during court-ordered evaluation proceedings.

SB1169 — Graduate Medical Education

Would have provided $18 million in funding and expenditure authority to expand medical-residency slots in Arizona.

SB1574 — School Immunization-Rate Disclosure

Would have required schools to make school-specific vaccination rates available upon request.

SB1716 — Clozapine Access

Would have reduced dangerous interruptions in access to clozapine for some people with serious mental illness.

SB1813 — Arizona State Hospital Bed Access

Would have based future admissions to the Arizona State Hospital on clinical need rather than geography. It also would have removed the outdated 55-bed limit for Maricopa County patients.

Bad Bills We Opposed — And Are Glad Died

HB2005 — Clinical Decisions Involving Unvaccinated Patients

HB2007 — Over-the-Counter Ivermectin

HCR2056 — Constitutional Right to Refuse Medical Mandates

HB2059 — Interstate 8 Speed Limit

HB2060 — University Health Centers and Abortion Care

HB2061 — Health-Care Services and Patient Rights

HB2107 — SNAP Purchase Restrictions

HB2148 — Legislative Appropriation of Federal Grants

HB2154 — Public Funding and Abortion Services

HB2267 — Renewable-Energy Projects as Public Nuisances

HB2331 — Reliable Energy Standard

HB2364 — Mailing Abortion Medication

HB2797 — SNAP and TANF Eligibility Red Tape

SB1016 — Religious Exemptions for Medical Products

SB1019 — Fluoridation Ban

SB1070 — “Trump Derangement Syndrome” Study

SB1194 — Clinical Decisions Involving Unvaccinated Patients

SB1236 — AHCCCS Eligibility Verification

SB1368 — SNAP Food Restrictions

The Bottom Line

The 2026 legislative session produced a mixed result. Several solid public-health measures became law, particularly bills improving health-care licensing, nursing-home oversight, mental-health screening in jails and court-ordered treatment procedures. Gov. Hobbs also vetoed several harmful measures.

At the same time, several useful bills died, including proposals addressing dental care during pregnancy, preventive dental services in AHCCCS, Arizona State Hospital access, lactation services and the physician workforce.

The immediate priority is clear: Gov. Hobbs should sign the good bills still on her desk and veto the remaining bills that would interfere with vaccination programs, disease-control measures and food aid.

Then the focus shifts to November. Voters will decide the fate of three legislative ballot referrals that could make it harder to vote, weaken ESA accountability and effectively end red-light cameras in Arizona.

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List of Ballot Propositions Taking Shape

Now that session is over we turn our advocacy attention toward taking positions on the various ballot measures in order to educate voters about the public health policy implications of each. There will likely be 5 ballot measures we’ll be taking public positions on by writing arguments in the voter publicity pamphlet.

It looks like there will be 11 or so propositions on the ballot. More detail on this in the coming weeks and months – but here’s a short summary of those we expect to take positions on in the voter publicity pamphlet:

SCR1004 — Photo-Enforcement Systems: Vote No

SCR1004 would make it much harder for Arizona cities and towns to use photo-enforcement systems. Communities without an existing contract by the end of 2026 would be barred from adopting the technology. Cities that already use it would need voter approval to keep their programs and would have to return to voters every 10 years.

There’s a reasonable debate about the overuse of speed cameras, especially when cities place them on roads with artificially low speed limits. But SCR1004 also covers red-light cameras. That goes too far. Properly placed red-light cameras can discourage drivers from running red lights and reduce dangerous T-bone crashes, serious injuries and deaths. Local communities should keep the ability to use this tool at high-risk intersections.

HCR2001 — AZ Secure Elections Act: Vote No

HCR2001 would make major changes to Arizona’s early- and mail-voting systems. It would require voters to provide government-issued identification when casting a ballot, including when voting by mail. It would end most early voting by 7 p.m. on the Friday before Election Day and require voters to confirm a specific mailing address before each biennial general election to continue receiving mail ballots.

Arizona’s existing mail-voting system is widely used and familiar to voters. Adding new paperwork and identification requirements would create avoidable barriers, especially for older adults, people with disabilities, rural residents and people with limited transportation options. Voting access affects whose voices are heard when elected officials make decisions about health care, education, housing and other conditions that shape community health.

Free, Fair and Secure Elections Act: Vote Yes

The Free, Fair and Secure Elections Act is a citizen initiative designed to protect access to voting in the Arizona Constitution. It would preserve voting by mail, early in-person voting and Election Day voting at county voting centers. It would also allow voters to sign up to automatically receive a ballot for each election.

The initiative would keep voter-identification requirements and specify that elections are decided only by eligible U.S. citizens. At the same time, it would prevent the Legislature from ending mail-in voting or sharply reducing the early-voting period.

Arizona voters have relied on early and mail voting for decades. Protecting that access matters from a public-health perspective because communities are healthier when eligible voters can take part in decisions affecting schools, health systems, transportation and local services.

Protect Education Act: Vote Yes

Arizona’s Empowerment Scholarship Account program has expanded rapidly, but the basic accountability rules haven’t kept pace. The Protect Education Act would add reasonable guardrails while preserving access for students with disabilities and others who qualified before the program’s 2022 expansion.

The measure would limit newer eligibility to families earning $150,000 or less, adjusted annually for inflation. It would prohibit the use of ESA funds for luxury and other noneducational purchases, require stronger financial transparency and establish basic safety standards. Schools and service providers receiving public money would face added oversight, including background-check requirements. Unused funds sitting in private accounts would be returned to support public education.

Education policy is health policy. Safe schools, effective education and responsible use of public resources all contribute to healthier communities.

HCR 2048 Poison Pill for Protect Education Act

On its face, HCR2048 would amend the Arizona Constitution to prohibit the state from sweeping unused ESA funds held for children of military families at the end of the year.

Although its title focuses on military families, the measure is really designed to nullify the Protect Education Act if it passes.

Current Arizona Department of Education policy already allows unused ESA funds to roll over from one fiscal year to the next for everybody who gets them.

The real reason for HCR2048 has nothing to do with military families. Its real purpose is to void the entire Protect Education Act if it passes.

Because there’s no targeted exemption for military families to keep left over ESA money, the Protect Education Act would be in conflict with HCR2048 if they both pass. At that point, the protect Education Act (which we support) would then be void