I/DD Waivers in Arizona

All states: Medicaid disability services map

Arizona I/DD services at a glance

Last verified against state sources: 2026-10-23.

Who runs I/DD services in Arizona?

The Arizona Department of Economic Security, Division of Developmental Disabilities (DDD) runs I/DD services. It does this under a contract with the Arizona Health Care Cost Containment System (AHCCCS), the state Medicaid agency. AHCCCS pays DDD a monthly amount for each member, and DDD contracts with and pays the provider agencies, which Arizona calls Qualified Vendors.

• AHCCCS: the state Medicaid agency. It runs the Arizona Long Term Care System (ALTCS), Arizona's Medicaid long-term care program, and decides who is eligible for ALTCS. For older adults and people with physical disabilities, AHCCCS runs ALTCS through health plans. For people with developmental disabilities, DDD is the contractor.
• DES Division of Developmental Disabilities (DDD): decides who has a qualifying developmental disability, provides case management, and contracts with Qualified Vendors for home and community based services (HCBS). As of June 2025, DDD served 61,227 people: 46,501 in ALTCS, 7,442 in Targeted Case Management and 7,284 in the state-only program, according to the Joint Legislative Budget Committee (JLBC) FY 2027 Appropriations Report.
• Front door: people apply to DDD. If a person may qualify for ALTCS, DDD refers them to AHCCCS for an ALTCS decision.
• Case management: DDD support coordinators, who are state employees, plan and coordinate services. From contract year 2026, AHCCCS funds caseloads of 48 members per coordinator for most DDD members, 24 for members with complex behavioral health or skilled nursing needs, and 43 for Parents as Paid Caregivers and AzEIP (Arizona Early Intervention Program) members.

What Medicaid waivers and programs serve people with I/DD in Arizona?

Arizona has no 1915(c) waivers, the federal option most states use for I/DD home and community services. Instead, all Medicaid long-term services in Arizona, including I/DD services, run under the state's Section 1115 demonstration, a broader federal approval, as ALTCS. People with developmental disabilities get ALTCS through DDD, a program often called ALTCS-DD.

• ALTCS for people with developmental disabilities (ALTCS-DD, 1115 demonstration): serves Arizona residents of any age who are eligible for DDD, have income under 300% of the SSI limit, and are at immediate risk of nursing facility or ICF/IID level of care on the Pre-Admission Screening. Services include support coordination; hourly habilitation, music habilitation and supported living habilitation; Day Services (Day Treatment and Training); group and individual supported employment; residential services in group homes and developmental homes; attendant care, homemaker, home health aide and nursing; respite (up to 600 hours a year based on assessed need); therapies, home modifications and transportation. Physical and behavioral health care comes through a DDD subcontracted health plan, either Mercy Care or UnitedHealthcare Community Plan.
• Targeted Support Coordination (Targeted Case Management): case management only, not an HCBS benefit. It serves DDD-eligible people who qualify for regular AHCCCS acute care but not for ALTCS (7,442 people in June 2025). AHCCCS pays DDD $240.25 per member per month for it from October 1, 2026.
• State-only services: DDD also serves people who are DDD eligible but not ALTCS eligible with state funds. Under A.R.S. 36-559, these services depend on available funding.

Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF/IID), both private and state-operated, including the state's ATP-Coolidge campus, are the institutional option, funded through DDD.

Does Arizona pay for I/DD services through managed care?

Yes. AHCCCS pays DDD a fixed monthly amount (capitation) for each ALTCS member, and DDD acts as the one statewide managed care contractor for I/DD long-term services. DDD is also a state agency, so it contracts with and pays the Qualified Vendors that deliver HCBS. Members choose one of two health plans for their physical and behavioral health care.

• Who pays HCBS providers: DDD. Habilitation, day services, employment, attendant care, respite and residential services are covered by DDD through Qualified Vendors, according to Mercy Care's provider manual.
• Health plans: Mercy Care and UnitedHealthcare Community Plan cover physical and behavioral health under subcontract with DDD. They also cover a few long-term services: nursing facility care, emergency alert systems, augmentative communication devices and habilitative physical therapy for adults 21 and older.
• One contractor for long-term services: the 2020 AHCCCS renewal notice states that ALTCS members with developmental disabilities have one statewide managed care entity for long-term services and supports but can choose between two plans for physical and behavioral health.
• Capitation: the Regular DDD capitation is $8,146.92 per member per month for October 1, 2026 through September 30, 2027, per the AHCCCS capitation rate notice.

Is there a waiting list for I/DD services in Arizona?

We did not find a state-published waiting list or count for DDD services. ALTCS-DD has no published enrollment cap. Services for people who are not eligible for ALTCS are a different matter: state law makes them subject to available funding.

• ALTCS-DD: we did not find a state statement either way on whether ALTCS-DD limits enrollment or keeps a list.
• State-only services: A.R.S. 36-559 requires a person to be found eligible or ineligible for ALTCS before receiving DDD services, and makes services for people found ineligible subject to funding. We did not find whether DDD keeps a waiting or interest list for these services.

Families who want to know whether they would wait for services can ask DDD. Its customer service line, 1-844-770-9500, is listed in UnitedHealthcare Community Plan's Arizona member handbook.

How do people apply for I/DD services in Arizona, and how are budgets set?

A person applies to DDD, which checks for a qualifying diagnosis. If the person may qualify for ALTCS, DDD refers them to AHCCCS, which must decide ALTCS eligibility before DDD services start. Once enrolled, the member's hours of direct care and habilitation are set using the HCBS Needs Tool.

• DDD eligibility: intellectual or cognitive disability, cerebral palsy, epilepsy or seizure disorder, autism, or Down syndrome. Children under 6 can qualify as at risk of a developmental disability, according to the AHCCCS Eligibility Policy Manual.
• ALTCS eligibility: income under 300% of the SSI limit (about $35,784 a year, per JLBC) and a Pre-Admission Screening (PAS) result showing immediate risk of nursing facility or ICF/IID level of care.
• If not ALTCS eligible: people who are DDD eligible get Targeted Support Coordination if they qualify for AHCCCS acute care, or state-only services, which depend on available funding.
• HCBS Needs Tool: AHCCCS Medical Policy Manual (AMPM) Exhibit 1620-17 sets direct care and habilitation hours. For members under 18, AMPM 1240-E (effective October 1, 2025) caps assessed habilitation hours by age: none under age 3, up to 5 hours a week at ages 3 to 5, 9 at ages 6 to 9, 11 at ages 10 to 12 and 14 at ages 13 to 17. Adults are not subject to these age limits.
• Parents as Paid Caregivers: parents of minor members can be paid to provide attendant care and habilitation. HB 2945 (2025) added limits, including a cap of 40 hours a week per child from July 1, 2025 and a rule that parents work through one agency.
• Self-direction: since June 30, 2026, the only member-directed option for DDD members is Agency with Choice, where a provider agency is the legal employer and the member chooses and directs the worker. The DDD Independent Provider Program, where the family was the employer, ended when its agreements expired that day.

What day and residential services can I/DD providers offer in Arizona?

DDD covers Day Services (Day Treatment and Training), supported employment and hourly habilitation for ALTCS members, along with group homes, developmental homes and state-operated group homes. Group homes are licensed by the Arizona Department of Health Services (ADHS), and developmental homes are licensed by DDD. The research did not find a published staff ratio, billing unit or certification rule for DDD day services, because DDD's rate book and Day Services policy could not be read. Ask DDD for its current service specifications.

Day and employment services

• Day Services (Day Treatment and Training): group habilitation in a day program setting, covered by DDD for ALTCS members. AHCCCS treats it as a habilitation service and leaves its rules to DDD. We did not find a published ratio, billing unit or license requirement.
• Employment services: AMPM 1240-J (effective March 1, 2023) applies to DDD and treats supported employment as a habilitation service. It follows Arizona's Employment First executive order (2017-08), requires person-centered employment planning, and describes group models such as enclaves and mobile work crews as well as individual supported employment. We did not find a published ratio or billing unit.
• Hourly habilitation: training in independent living, social and adaptive skills, delivered at home or in the community. It is an EVV service, and hours for members under 18 are capped by age (see above).

Residential services

• Group home: a community home for no more than six people with developmental disabilities, run by a provider under contract with DES, with room and board, daily habilitation and other assessed services. Behavioral-supported and nursing-supported group homes are variants. Group homes are licensed by ADHS, according to AMPM 1230-C. Medicaid does not pay room and board. DDD sets the amount, and the member pays it under a residency agreement.
• Adult and child developmental homes: a host home model. A licensed family, not employed by DDD or a provider, gives 24-hour care, room and board, habilitation, personal care and supervision to a sibling group or up to three adults or three children. These homes are licensed by DDD.
• State-operated group homes: group homes staffed by DES and funded through DDD's HCBS budget.
• ICF/IID: private and state-operated facilities, including ATP-Coolidge, are the institutional option.

How are I/DD provider rates set and how do agencies enroll in Arizona?

DDD sets the rates it pays Qualified Vendors and publishes them in a rate book. State law requires an annual independent study of whether DDD's Medicaid rates are adequate and a complete rate study at least every five years. We could not open the current rate book, so we did not confirm the latest provider rate change. Agencies register with AHCCCS through its Provider Enrollment Portal and contract with DDD as Qualified Vendors.

• Rate studies: under A.R.S. 36-2959, DES must contract for the annual adequacy study and the five-year rate study, include the results in its capitation request to AHCCCS, and report to the JLBC before any statewide DD provider rate change that is not already authorized.
• Latest funding change: AHCCCS raised the DDD capitation 4.3% on October 1, 2025, plus a further 1.4% retroactive to that date (5.7% in total). This is the payment to DDD, not a provider rate. We did not find the date of the latest change to Qualified Vendor rates.
• Enrollment: providers register through the AHCCCS Provider Enrollment Portal (APEP) and must revalidate every four years. We did not find a DDD page describing the Qualified Vendor application, so agencies should ask DDD how to become a Qualified Vendor.
• EVV services: DDD's provider resources page lists attendant care, homemaker, hourly habilitation, home health nursing and respite as electronic visit verification (EVV) services.
• EVV system: Arizona uses an open model. Each agency contracts its own EVV vendor, which sends visit data to the AHCCCS Aggregator. The Aggregator replaced Sandata on October 1, 2025, according to the AHCCCS EVV page.
• Parent caregivers: from October 1, 2025, Qualified Vendors must use live-in caregiver EVV data elements and a CG claim modifier for care provided by parents.

What is changing next for I/DD services in Arizona?

Revised needs assessment and extraordinary care review rules take effect December 1, 2026 for ALTCS members under 18, including DDD children. The revised HCBS Needs Tool and Extraordinary Care Review policies apply to children assessed for direct care or habilitation. Adults are not subject to the tool's age limits.

• Children's assessment rules: DDD and the ALTCS health plans began using the updated HCBS Needs Tool for children on October 1, 2025. The Governor then directed emergency rulemaking, and Laws 2026, Chapter 132 lets AHCCCS finalize the tool and the Extraordinary Care Review through exempt rulemaking. Families who disagree with the age-based limits can ask for a clinician Extraordinary Care Review. AHCCCS took public comment from September 12 through October 12, 2026. Details are in AHCCCS's HCBS Needs Tool and Extraordinary Care Review FAQs.
• 1115 demonstration renewal: AHCCCS posted a draft renewal of the 1115 demonstration that authorizes ALTCS, for October 2027 through September 2032. It is a draft, and the page does not say it has been sent to CMS. We did not find what, if anything, it changes for ALTCS-DD.

Two recent changes are already in place: the DDD Independent Provider Program ended on June 30, 2026, so independent providers now work through a Qualified Vendor agency, and HB 2945 limits on Parents as Paid Caregivers have applied since July 1, 2025.

Arizona I/DD sources

• Joint Legislative Budget Committee: FY 2027 Appropriations Report, Department of Economic Security
• AHCCCS Eligibility Policy Manual 1004: Developmental Disability Status
• AHCCCS: 1115 Waiver Renewal Public Notice (2020)
• Mercy Care: Provider Manual Chapter 300 (July 2026)
• AHCCCS Medical Policy Manual 1240-E: Habilitation and Day Services
• AHCCCS Medical Policy Manual 1230-C: Alternative HCBS Settings
• AHCCCS: HCBS Needs Tool and Extraordinary Care Review FAQs
• AHCCCS: Electronic Visit Verification
• DES Division of Developmental Disabilities: Provider resources
• Arizona Revised Statutes 36-559

Related reading

• Disability Services and Independent Living Guide
• Essential Acronyms in Disability Services: A Quick Reference Guide
• Disability Services DayHab has a dilemma - how to solve it
• Developmental Disabilities vs. Mental Health: Key Differences
• I/DD services in every state (map)
• Arizona EVV requirements

Other states that use managed care for I/DD services

Arkansas, Iowa, Kansas, Michigan, North Carolina, Tennessee. See every state on the I/DD services map.

Page history

• October 23, 2026: Page rewritten and checked against state sources.

This page is a reference, not legal advice. State rules change, so confirm details with the state before you act on them.

Ankota provides software for I/DD provider agencies, including EVV, service documentation, goal tracking and billing. If you would like to talk through your program, contact Ankota or read more about Ankota's I/DD software.