Key Takeaways
- AHCCCS (Arizona Health Care Cost Containment System) is Arizona's Medicaid program providing coverage to low-income residents
- KidsCare is Arizona's CHIP program providing health coverage for children in families with income too high for AHCCCS but too low for private insurance
- The Arizona Life and Disability Insurance Guaranty Fund protects policyholders when insurers become insolvent
- Arizona participates in the Long-Term Care Partnership Program providing Medicaid asset protection for qualifying LTC policies
- Producers must understand state programs to help clients evaluate their coverage options
Arizona State Insurance Programs
Arizona operates several state programs that insurance producers should understand when helping clients evaluate their coverage options.
AHCCCS - Arizona Medicaid
AHCCCS (Arizona Health Care Cost Containment System) is Arizona's Medicaid program:
Who AHCCCS Covers
| Population | Income Limit (approx.) |
|---|---|
| Adults (expansion) | 138% Federal Poverty Level (FPL) |
| Pregnant women | 156% FPL |
| Children | Higher limits vary by age |
| Seniors/Disabled | SSI-related eligibility |
AHCCCS Coverage
AHCCCS provides comprehensive coverage including:
- Doctor visits
- Hospital care
- Prescription drugs
- Mental health services
- Long-term care
- Dental (limited for adults)
- Vision (limited for adults)
Exam Tip: AHCCCS is Arizona's Medicaid program. Unlike most states that call it "Medicaid," Arizona uses the AHCCCS name. Producers should know basic eligibility when clients ask about coverage options.
KidsCare - Arizona CHIP
KidsCare is Arizona's Children's Health Insurance Program (CHIP):
KidsCare Eligibility
| Requirement | Details |
|---|---|
| Age | Under 19 |
| Income | Above AHCCCS limits, below 200% FPL |
| Residency | Arizona resident |
| Citizenship | U.S. citizen or qualified immigrant |
| Insurance | Not covered by employer insurance |
KidsCare Benefits
- Comprehensive health coverage
- Doctor and specialist visits
- Hospital care
- Prescription drugs
- Dental care
- Vision care
- Mental health services
- Immunizations
KidsCare Costs
- Monthly premiums based on income
- Lower than private insurance
- Minimal copays for services
Arizona Long-Term Care Partnership Program
Arizona participates in the Long-Term Care Partnership Program:
How the Partnership Works
- Purchase a Partnership-qualified LTC policy
- Use benefits for qualifying long-term care
- If benefits exhaust, apply for AHCCCS (Medicaid)
- Asset protection: Keep assets equal to benefits received
Partnership Benefits
| Without Partnership | With Partnership |
|---|---|
| Spend down to $2,000 | Protect assets up to benefits paid |
| May lose home equity | May keep home and assets |
| Standard AHCCCS rules | Enhanced asset protection |
Partnership-Qualified Policy Requirements
- Policy must meet federal and Arizona requirements
- Inflation protection required (for those under 76)
- Must be sold by trained producer
- Must be certified as Partnership-compliant
Exam Tip: The Partnership Program allows people to protect assets from Medicaid spend-down equal to the benefits their LTC policy pays out. This is a significant planning tool.
Arizona Premium Sharing Programs
Employer Premium Sharing
Arizona allows premium sharing programs:
| Program | Description |
|---|---|
| Section 125 | Pre-tax premium payments |
| HRA | Health Reimbursement Arrangements |
| HSA | Health Savings Accounts (with HDHP) |
| QSEHRA | Qualified Small Employer HRA |
Federal-State Program Interaction
Understanding how programs interact:
Coverage Hierarchy
| Priority | Coverage Type |
|---|---|
| 1 | Employer group coverage |
| 2 | COBRA continuation |
| 3 | Individual/Marketplace coverage |
| 4 | AHCCCS/KidsCare |
When to Consider State Programs
Help clients evaluate when state programs may apply:
- Job loss without COBRA eligibility
- Income reduction
- Self-employment
- Early retirement before Medicare
- Children's coverage needs
Arizona Life and Disability Insurance Guaranty Fund
The Arizona Life and Disability Insurance Guaranty Fund protects policyholders when insurers become insolvent:
Coverage Limits
| Policy Type | Maximum Coverage |
|---|---|
| Life Insurance Death Benefit | $300,000 |
| Life Insurance Cash Value | $100,000 |
| Annuity Present Value | $250,000 |
| Health Insurance Benefits | $500,000 |
| Disability Income | $300,000 |
| Long-Term Care | $300,000 |
What's Covered
- Individual life insurance
- Group life (Arizona residents)
- Annuities
- Health insurance
- Disability insurance
- Long-term care insurance
What's NOT Covered
- Unallocated annuity contracts
- Investment portions of variable products (covered by SIPC)
- Self-funded employer plans
- Government programs
- Surplus lines policies
- Amounts above coverage limits
Producer Restrictions
Producers CANNOT:
- Use guaranty fund coverage as a selling point
- Advertise guaranty fund protection
- Compare to FDIC insurance
- Imply policies are "guaranteed"
Exam Tip: Arizona's life insurance guaranty fund coverage of $300,000 for death benefits is lower than some states like California ($500,000). Know the Arizona-specific limits.
Producer Responsibilities for State Programs
When advising clients, producers should:
Information to Provide
- Awareness - Make clients aware of state programs
- Eligibility - Suggest checking eligibility if appropriate
- Comparison - Help compare private vs. state options
- Referral - Direct to appropriate resources
What Producers Should NOT Do
- Guarantee eligibility for state programs
- Discourage appropriate private coverage
- Make false statements about state programs
- Provide tax or legal advice
What is AHCCCS?
What is the primary benefit of purchasing a Partnership-qualified long-term care policy in Arizona?
What is the maximum death benefit coverage provided by the Arizona Life and Disability Insurance Guaranty Fund?
Can producers use Arizona Guaranty Fund coverage as a selling point for insurance?
What is KidsCare in Arizona?
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