Across Phoenix living rooms and small group homes, families say they are bracing for a policy shift that feels less like a tweak and more like an earthquake. A sweeping federal budget law known as H.R. 1 shifts hundreds of billions in Medicaid funding and creates new rules that advocates warn could chip away at Home- and Community-Based Services (HCBS) that many Arizonans rely on. Parents, caregivers and people with disabilities say losing even a few hours of paid in-home support would have immediate, harsh consequences for people who need help around the clock.
How the federal bill changes Medicaid
The Budget Reconciliation Act of 2025, H.R. 1, reduces federal Medicaid funding over the coming decade and moves substantial costs onto states, a shift that experts say puts optional benefits like HCBS on the chopping block, according to Georgetown Center for Children and Families. Congressional Budget Office figures in that analysis show nearly $990 billion in gross Medicaid and CHIP cuts over ten years. Provisions such as limits on provider assessments, tighter retroactive eligibility and work reporting for certain adults could squeeze state budgets and complicate access to care.
What Arizona officials are saying
Arizona's Medicaid agency has published an H.R. 1 overview that lays out implementation timelines and warns the law will require changes to eligibility rules, renewals and provider financing, according to AHCCCS. The agency notes community-engagement, or work, requirements and biannual renewals for some adults begin in 2027 and that reductions in federal matching funds will shift costs to the state. AHCCCS says it will host forums and share notices to help members and providers prepare as federal guidance arrives.
How many Arizonans depend on these services
The Arizona Department of Economic Security says the Division of Developmental Disabilities serves more than 59,000 people statewide who receive supports ranging from early intervention to in-home nursing and supported living, per DES. Most DDD members live at home or in community settings, and advocates point to the 1999 Supreme Court decision Olmstead v. L.C., which enshrined a right to community integration for people with disabilities, as part of the legal backdrop to state HCBS policy, according to KFF.
Voices from Phoenix
In Phoenix, families describe what those policy choices look like at home. Tricia Huber, who has spastic quadriplegic cerebral palsy, told KJZZ she "needs help 24 by seven" and that her family waited five years to secure part-time nursing assistance. Another family told the station early intervention services were crucial to an 11-year-old with Down syndrome and autism, and that losing those supports would be devastating. Those personal stories underline how quickly the cost of equipment and care, from a $20,000 wheelchair to a bathing lift that can top six figures, can overwhelm families without Medicaid.
The cost calculus: community care vs. institutions
Federal data highlight a major reason states invest in HCBS: institutional long-term care is far more expensive per person than community-based services. A 2023 CMS brief found average Medicaid spending per user was about $17,298 for HCBS versus roughly $54,462 for institutional long-term services and supports, as reported on Medicaid.gov. That gap means cuts to home services can be both a human tragedy and a budget move that backfires if people are pushed into higher-cost institutional care.
What advocates and experts warn
Advocates say the choices Arizona faces are stark: protect HCBS now or risk higher costs and worse outcomes later. "We have the most generous system in the nation and it is too ingrained to change," Jon Meyers of the Arizona Developmental Disability Planning Council told KJZZ, while Alex Green, a disability policy scholar, warned policymakers might "let people die in their homes" if services are slashed. Those blunt assessments frame the policy debate state lawmakers will confront as they consider budgets and whether to shore up HCBS funding.
Whats next
AHCCCS says it will keep members informed, share guidance and host stakeholder sessions as federal instructions arrive, and advises members to keep contact details current on HealtheArizona Plus, per the agency's H.R. 1 page. Families and providers plan to press the Legislature for protections and targeted investments, including better pay for caregivers, that advocates say are necessary to preserve home care. With budget negotiations and rulemaking still unfolding, many Arizona households say they are already living on the edge.
