PHOENIX — Dozens of behavioral-health providers and trade groups told the Arizona Senate Health and Human Services Committee that reforms intended to stop criminal patient-brokering have had unintended consequences: longstanding, licensed providers report months-long payment delays, unpredictable prior-authorization processes and financial strain.

Representatives of the Arizona Council of Human Service Providers and nationally accredited behavioral-health operators described prolonged payment waits and prior-authorization backlogs that in some cases forced programs to carry costs for weeks or months. "These prolonged payment delays on top of inadequate rates make it increasingly difficult for providers to keep their doors open," Michelle Coldwell of the Arizona Council of Human Service Providers said.

Several witnesses testified that the American Indian Health Program (AIHP) population has been particularly affected. Amy Graves, CEO of The Haven in Tucson, said the nonprofit accepts AIHP members but is currently owed about $375,000 for AIHP-billed services. "The Haven has never been investigated or accused of any fraud, waste, or abuse and is stuck in a situation that is not of its own making," Graves said.

Access fee-for-service officials explained how claims and prior-authorizations are reviewed under new safeguards. Lynn Emmons, assistant deputy director for fee-for-service programs, said prepayment review flags fall into two categories: providers whose coding is two standard deviations above the peer average (automatic "spike" flags) and a provider-based group flagged for full review where prior concerns exist. Emmons told the committee that about 382 providers were added to a 100 percent prepayment-review list in January'February 2024, and that the approval rate of behavioral-health claims that reach the prepayment-review process has risen to roughly 84 percent.

On timing, Access officials acknowledged long turnarounds for some processes. Emmons said clean claims are adjudicated within about 10 days, while claims placed on prepayment review average about 131 days. She said prior-authorization turnaround for non-urgent requests is averaging around 17 days (urgent reviews are handled in 72 hours). Committee members and providers said those timeframes are inconsistent with clinical needs: providers said patients often complete treatment before authorizations are returned and providers end up bearing the cost.

Providers and advocates requested concrete remediation: a provider-relations contact, faster appeals and clearer, timely technical assistance. Access leaders acknowledged gaps and said they are adding staff, building provider-relationship teams and developing dashboards to show turnaround times and case status.

Why it matters: Behavioral-health providers operate on narrow margins and require timely reimbursement to remain solvent. Multiple witnesses reported closures, layoffs or significant write-offs linked to prolonged payment delays and marketplace-plan switching tied to the fraud schemes.

What's next: The committee requested additional data from Access, including provider counts, suspension and termination numbers, appeals and rescissions dating back to 2019, and promised a follow-up hearing to review the agency's plans.

Provenance: Reporting from testimony by Michael Coldwell (Arizona Council of Human Service Providers), Heather Dukes (accredited providers), Amy Graves (The Haven) and Lynn Emmons (Access DFSM).