When Proposition 204 was approved by Arizona voters last November, it was only the beginning of complex legislative negotiations with Arizona's coun-ties, hospitals and state agencies on the most effective and efficient ways to deliver expanded health care and prescription drug coverage to thousands of Arizona's working poor. The implementation of Prop 204, encapsulated in House Bill 2630, promises to be one of the largest single improvements ever in health care coverage for rural Arizona.
Proper health care is a benchmark to productive and gainful lives. Rural Arizonans, like many other Americans, have found it increa-singly difficult to afford massive increases in the costs of private health insurance. Many hard work-ing families have been forced to choose between the basic essentials and the price of health insurance. And for those that are eligible for Medicare, the cost of prescription drugs has resulted in a choice between no prescription or a trip across the border to Mexico.
Nov. 7, 2000 marked the date that Arizona voters approved Prop 204, an initiative to direct our share of the $3.4 billion tobacco settlement. Although several alter-natives were proposed, the most popular use for the tobacco settlement dollars was determined to be health care coverage.
Currently, the Arizona Health Care Cost Containment System (AHCCCS), provides health care coverage for over 550,000 Arizonans that earn around 35 percent of the federal poverty level, or about $2,820 dollars per year.
With the new voter-approved mandate, coverage is greatly expanded, and particularly to rural Arizona citizens who work hard to earn a living, but cannot afford the rapidly rising costs of expensive insurance. The new legislation opens coverage to citizens earning up to 100 percent of the federal poverty level, or about $700 per month. For a family of four, 100 percent of the federal poverty level is about $17,000 annually. Previously, a family of four couldn't make more than $5,000 to qualify for state assistance. Up to 180,000 Arizonans may become eligible for the larger program.
Rural Arizona's growing senior population has been the victim of astronomical increases in the costs of purchasing prescription drugs. For many, the only solution has been to seek less expensive alternatives, often found in neighboring countries. Prop 204 essentially created a prescription drug benefit for approximately 74,000 Medicare recipients at 100 percent of the federal poverty level or below.
In addition to greatly expanded AHCCCS coverage, and better prescription drug benefits for thousands of seniors, millions of new dollars will be added to the state's program for the seriously mentally ill (SMI). The mentally ill are Arizona's most vulnerable citizens.
Our state has provided health care to our SMI population throughout our state's history, and even prior to statehood. However, a rapidly growing patient population and very limited funding has hampered state efforts to properly care for Arizonans with mental illness. These new dollars will significantly improve SMI care, and go a long way toward resolving one of our state's most important needs.
The wise use of taxpayer dollars is an issue that legislators must always take very seriously and has been a top consideration in how to appropriately implement Prop 204. Although much of the new funding for health care coverage will come from Arizona's tobacco settlement funds, fully 65 percent of the cost of implementing the expanded program will come from the federal government. Arizona's congressional delegation helped to secure federal approval of our new program, saving the state's general fund up to $800 million over the next five years.
Over the next several months, I will be joined by a select group of legislators in a special task force to examine the need for a statewide health care insurance plan. This task force will re-focus our efforts on behalf of the rest of Arizona, those above the 100 percent federal poverty level. The rapid decline of HMO's in rural Arizona have created an emergent need to find more cost efficient ways to provide private health insurance to our citizens.
Many major hurdles have now been cleared on the road to implementation of Prop 204 and improved health care for Arizona's working poor. Although much work is still to be done on health care as a whole, rural Arizona stands to benefit from the foresight and commitment of Arizona voters when they approved Proposition 204.
(Tom O'Halleran, a Republican who resides in Sedona, is an Arizona State Representative for District 2, which includes Williams.)