Arizona's newest frontier: health care cost containment

Fear of cost overruns, fraud and red tape had kept Arizona out of the Medicaid program, the only state to reject it. Financial pressures on the counties finally forced a statewide approach to subsidized health care for the poor. But Arizona still did not embrace Medicaid. Instead it enacted a demonstration program designed not only to serve the poor but to attract the private sector by dint of lower health care costs achieved through competition and a number of other mechanisms. The program became operable on Oct. 1, 1982 and, depending upon its success, may serve as a model of programs to come in other states.