5 Things Arizona: Recommendations for youth mental health, Rural workforce needs, AzHHA on decreasing hospital operating margins


Eli Kirshbaum


This month’s newsletter includes a breakdown of recommendations presented to the Arizona House’s Teen Mental Health Ad Hoc Committee, the Arizona Center for Rural Health’s proposals for continuing to support the struggling rural health workforce, and insight from the Arizona Hospital and Healthcare Association about mitigating the decreasing financial operating margins that Arizona hospitals are facing.

As always, please don’t hesitate to reach out to me if you have questions, comments, or would just like to connect. Thanks very much for reading!

Eli Kirshbaum
State of Reform


1. Legislative group on teen mental health hears input on SUD support, avoiding ACEs, and more

The Arizona House’s Teen Mental Health Ad Hoc Committee has been spending the interim gathering expert recommendations for improving youth mental health in the state. To address substance use disorder among youth, an expert workgroup outlined strategies including creating a Community Information Hub to provide accessible information on SUD, implementing tax credit deductions for SUD treatment to increase service affordability, and re-evaluating consent laws to allow 16 and 17-year-olds to consent to SUD treatment without parent/guardian approval.

Another group of experts recommended the creation of a state Youth Mental Health Coalition to bring together schools, health plans, and CBOs to develop a coordinated approach to treating youth mental health issues. ADHS also recently provided the committee with a 3-part strategy for reducing the rate of adverse childhood experiences in the state: increasing surveillance and data visualization on ACEs, enhancing provider awareness of ACEs by providing them with training media, and making Arizona’s public health system more “trauma-informed” to account for ACEs.


2. Strategies for strengthening Arizona’s understaffed rural health workforce

Rural Arizona’s physician-patient ratio is around half of urban Arizona’s (130 versus 254 physicians per 100,000 people, respectively). Despite 10.2% of Arizonans living in rural areas of the state, only 5.5% of the state’s physicians practice in rural areas. This data comes from the AZ Center for Rural Health’s recent Physician Specialty Workforce Profile, which presents strategies the state can use to augment the state’s rural health care workforce.

AzCRH encourages solutions that incentivize providers to practice in medically underserved areas, such as the Arizona State Loan Repayment Program. AzCRH’s Research Program Administrator Bryna Koch said these initiatives can be particularly effective for the state’s large American Indian and Hispanic/Latino populations. “The evidence is quite clear that Hispanic Latino populations [and] American Indian populations tend to go into the specialties that are most needed, such as primary care, but also go into areas where they’re most needed and back into communities,” she said.


3. What They’re Watching: Meghan McCabe, Arizona Hospital and Healthcare Association

In this edition of our “What They’re Watching” series, Meghan McCabe, Government Affairs Director for the Arizona Hospital and Healthcare Association (AzHHA), says she’s watching the upcoming midterm elections in Arizona and how potential electoral outcomes could impact state health policy. With many legislative seats as well as the governor’s office on the line, new leadership dynamics could have an impact on Arizona’s health policy landscape.

McCabe says AzHHA is also focused on supporting the state’s health care workforce (this year, for instance, the organization advocated for the recently passed House Bill 2691, which expands resources for the nurse workforce pipeline) and advancing health equity. “Across the organization more broadly, we’re really focused on a few health equity projects around maternal health [and] around addressing health disparities resulting from COVID-19. So that work is … a top focus area for us.”



4. AzHHA illustrates lingering financial strain on hospitals

AzHHA’s recently released Quarterly Financial Analysis shows that net operating margins among 21 of its member hospitals decreased from 0.5% in the first quarter of 2022 to -8.7% in the second quarter. The organization says this intensifying financial strain is primarily due to skyrocketing labor costs, as well as inflation-induced supply cost increases.

AzHHA President and CEO Ann-Marie Alameddin said a key part of the solution will be getting health plans to more closely align their reimbursements with hospital needs. “Reimbursement has not caught up with the rate of inflation,” she said. “Hospitals must be reimbursed for the care they provide at today’s prices, not what was in negotiated contracts before the pandemic.” She added that policymakers should refuse to implement proposed health care funding cuts.


5. AHCCCS receives approval for unhoused support program

CMS recently approved AHCCCS’s Housing and Health Opportunities (H2O) project through its 5-year extension of Arizona’s 1115 waiver. This project aims to expand housing services and interventions for the unhoused and those at risk of being unhoused. Joanna Carr, Research and Policy Director at the Arizona Housing Coalition, said the project is a response to the state’s increase in homelessness since the pandemic started.

Carr said she is looking forward to seeing greater collaboration between the housing and health sectors through implementation of the H2O project. “We have seen the importance of recognizing how health and housing are inextricably linked, such as the link between homelessness, substance use, and mental health,” she said. “What we need to focus on is the gains the community will yield in the implementation of this project simply by bringing increased resources, services, expertise, and opportunity for collaboration.”