THE VBP Blog
Arizona MLTSS: How ALTCS Has Performed and What Comes Next
Learn how Arizona’s ALTCS program is structured, how it has performed for members, and what the upcoming reprocurement could change.
September 9, 2026 –
Arizona is an important state to examine in any discussion of managed long-term services and supports because the Arizona Long Term Care System (ALTCS) brings medical care, behavioral health services, institutional care, and home and community-based services (HCBS) together for people who require a nursing facility level of care. The program does not operate through one uniform structure, with different populations receiving services through different entities. That makes Arizona a useful example of how one statewide MLTSS system can use different delivery models to meet the needs of distinct populations.
Arizona is also entering an important period of change. The State has rebid ALTCS E/PD contracts, with new agreements expected to take effect in October 2027. This creates an opportunity to examine how ALTCS was originally structured, how well it has performed for members, and whether the next contract addresses concerns about access, provider choice, care coordination, continuity, and community-based living.
How The Current ALTCS Model Works
Arizona’s ALTCS program has evolved through several different delivery pathways rather than a single statewide contract structure. The system is structured around different populations and delivery pathways. Elderly individuals or those with physical disabilities receive services through ALTCS E/PD MCOs operating within county-based service areas. The Division of Developmental Disabilities functions as the statewide ALTCS contractor for eligible individuals with developmental disabilities. At the same time, separate Tribal ALTCS pathways serve many eligible American Indian and Alaska Native members through tribal plans.
AHCCCS pays MCOs a fixed, capitated amount for each enrolled member, and they are responsible for coordinating a comprehensive package that includes medical care, behavioral health services, nursing facility care, home and community-based services, and case management.
ALTCS MCOs work like a Health Management Organization (HMO). The health plan works with doctors, nursing homes, assisted living facilities, hospitals, pharmacies, and specialists to provide the medically necessary services. These include medical benefits, behavioral health services, and long-term care services.
Case management is a central part of the ALTCS model. Each member is assigned a case manager through the contractor who works with the member and providers to develop a service plan and is responsible for authorizing and monitoring ALTCS services. MCOs are also responsible for maintaining provider networks delivering those services. From a consumer perspective, this structure can create clearer responsibility for coordinating care and supporting community living.
How ALTCS Has Performed for Members
Arizona’s strongest ALTCS result has been its emphasis on home and community-based care. In the four reporting periods through contract year 2024, only about 9% of ALTCS members were living in institutional settings, meaning the large majority received services in homes or community-based settings. The state has also expanded options that give members more control over who provides their care, including self-directed attendant care, Agency with Choice, and paid family caregiver models. However, the number of members using this option decreased over the last year, and Arizona ranks among the worst states for self-directed program enrollment.
Member feedback, however, shows that having a high share of ALTCS members receiving care in home and community-based settings does not necessarily mean the community-living experience is seamless. In Arizona’s 2023–2024 National Core Indicators survey of ALTCS long-term care members, 84% of respondents stated that their services and supports help them live the life they want. However, only 72% of ALTCS E/PD respondents said their services completely met their current needs and goals. And only 58% said they were able to do things outside their home as much as they wanted. Additionally, more than one in five did not know whom to contact to complain about their services.
Those results suggest that community living depends on more than avoiding institutional placement, and that provider choice is an area of concern for members. Arizona continues to monitor HCBS network gaps and provider capacity amid ongoing direct-care workforce challenges, and consumer survey results suggest those pressures can affect meaningful choice. These findings do not necessarily indicate that MCOs are deliberately narrowing their networks, but they do raise questions about whether consumers have enough providers available to exercise meaningful choice and self-direction.
Recent external quality reviews show a similar mixed picture. MCOs performed strongly on several medication management and other quality measures. At the same time, reviewers gave MCOs high-confidence ratings for the accuracy and reliability of their appointment-availability and time/distance network indicators. However, MCOs still had compliance gaps involving service authorization, grievances and appeals, emergency care, and quality improvement. Arizona’s DDD program also performed strongly on several behavioral health follow-up measures but continued to struggle with access to substance use disorder treatment and some preventive screenings.
Overall, ALTCS has built a strong foundation for community-based care. However, the consumer experience still depends on whether members can obtain authorized services consistently and navigate the system when problems arise.
What the New ALTCS E/PD Procurement Changes
Arizona recently released a new ALTCS E/PD procurement on August 4, 2026. While the new contract keeps the core managed care model, . The current structure divides the state into North, Central, and South service areas, with plan choice varying by location. The new RFP creates one statewide Geographic Service Area with multiple statewide contracts, which could give rural members more consistent plan options. However, MCOs will still need to demonstrate adequate provider networks across very different urban and rural communities.
The new RFP also strengthens consumer involvement. ALTCS Member Councils will grow from at least 10 members to at least 25, with at least 51% representing consumers, families, and advocacy organizations. Plans must also employ an ALTCS Member Liaison with lived experience navigating the program. These changes could bring participant feedback closer to day-to-day plan operations.
Case management requirements are also becoming more specific. The new RFP establishes weighted caseload standards, including a general maximum of 43 members for case managers serving people in their own homes, and requires MCOs to monitor gaps between authorized and actually delivered services. The latter is something that we’re starting to so as a new requirement across several states. The new procurement also continues Arizona’s push toward greater Medicare-Medicaid integration. Each ALTCS E/PD MCO must operate a companion FIDE SNP statewide by January 2028. Dual-eligible members are not required to enroll in a FIDE SNP, but those who choose one must be enrolled in a FIDE SNP aligned with their ALTCS E/PD MCO.
Overall, the changes target several issues that directly affect consumers: uneven plan choice, rural access, case manager workloads, service gaps, and limited participant input. The real test will be whether these stronger requirements translate into more reliable services, better coordination, and a more consistent and improved member experience.
Advocate’s Perspective
Arizona’s ALTCS program shows that MLTSS can support community living at scale, but placement in the community should not be the only measure of success. From a consumer advocate perspective, the stronger test is whether members can actually get the services they need, participate in their communities, understand their rights, and resolve problems without unnecessary barriers. Arizona ranks 22nd in the country for overall LTSS performance, according to AARP. The new ALTCS E/PD procurement gives Arizona an opportunity to build on what has worked while addressing those gaps. Statewide plan availability, stronger case management standards, greater consumer representation, and closer Medicare-Medicaid integration could all improve the member experience.
Onward!
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About the Author
Fady Sahhar brings over 30 years of senior management experience working with major multinational companies including Sara Lee, Mobil Oil, Tenneco Packaging, Pactiv, Progressive Insurance, Transitions Optical, PPG Industries and Essilor (France).
His corporate responsibilities included new product development, strategic planning, marketing management, and global sales. He has developed a number of global communications networks, launched products in over 45 countries, and managed a number of branded patented products.
About the Co-Author
Mandy Sahhar provides experience in digital marketing, event management, and business development. Her background has allowed her to get in on the ground floor of marketing efforts including website design, content marketing, and trade show planning. Through her modern approach, she focuses on bringing businesses into the new digital age of marketing through unique approaches and focused content creation. With a passion for communications, she can bring a fresh perspective to an ever-changing industry. Mandy has an MBA with a marketing concentration from Canisius College.
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