Arizona SNAP Eligibility Collapse Signals Warning for Medicaid, Study Finds

Largest SNAP Drop in Nation Leaves 400,000 Arizonans Without Food Assistance

More than 400,000 Arizonans have lost their SNAP benefits since July — the largest decline in the nation by a wide margin — as an underfunded state agency administered changes called for in President Donald Trump's One Big Beautiful Bill Act.

The drop represents nearly 47 percent of the state's participants in the program better known as food stamps and includes about 180,000 children, according to the Arizona Department of Economic Security.

Arizona Outpaces Other States

After Arizona, the largest loss of participants was in Florida, where less than 16 percent of recipients lost benefits, according to analysis by the Center on Budget and Policy Priorities.

Nationwide, SNAP enrollment plummeted 8 percent from December 2024 to December 2025, according to estimates from the U.S. Department of Agriculture.

Administrative Failures Complicate Policy Changes

Arizona officials attribute the plunging caseload to swift implementation of policy changes forced by the bill, including new work requirements. But interviews suggest that Arizona's efforts to comply, combined with cuts to the agency that runs the program, have contributed to the decline.

Last summer, DES also laid off about 500 employees in response to the elimination of federal grants and in anticipation of additional federal cuts. Officials said that about 160 eligibility specialists lost their jobs, a 40 percent decline since July 2024.

The number of workers who reviewed food stamps eligibility dropped by 1,370 in July 2024 to 880 this past July.

Arizona is just the alarm bell, said Joseph Palomino, executive director of the Arizona Center for Economic Progress. This is likely going to happen in every state.

Charisma Garcia, a 25-year-old mother of two, has tried for months to obtain an interview to complete a SNAP application. After weeks calling the agency only to get a recorded message, she woke before sunrise recently to wait in line at an Arizona Department of Economic Security office in south Phoenix.

A security guard told her the agency was not doing in-person interviews, so she headed to a food bank instead. She needed to feed her children, ages 3 and 6.

I need to do the thing that gets me the food, she said.

Medicaid Looms as Next Concern

What happened to SNAP in Arizona is a warning sign for what is coming next year in Medicaid. In January 2027, new Medicaid work requirements are scheduled to take effect, affecting roughly 350,000 people enrolled in AHCCCS.

Those requirements will depend on the same kinds of eligibility systems and administrative processes currently failing SNAP participants.

If Arizona cannot reliably process SNAP eligibility today, there is a real risk these problems will spill over into Medicaid, at a much larger scale, especially if part of the reason was the clunky Health-e-Arizona computer system.

State leaders need to take a hard look at what happened at ADES to cause this enormous drop in SNAP eligibility. If part of it is the Health-e-Arizona Plus system, they need to fix it now, so we do not have a repeat in Medicaid early next year.

Error Rates and Penalties

In addition, the bill mandates that states reduce their payment error rates — which measure the accuracy of eligibility and payment determinations — or face millions in penalties.

Although some changes do not fully take effect until the fall, experts say Arizona's experience suggests people are already going hungry as a result of the legislation's changes.

In the 2023-2024 budget year, Arizona had an 8.8 percent error rate. But for the last fiscal year it was projected to be 10.4 percent.

If the error rate remains at 8.8 percent, the state could have to cover $195.4 million in the 2027-2028 fiscal year. And if the error rate hits 10 percent, that figure could reach nearly $300 million.

Arizona's rate of 8.8 percent is below the national average, but the new federal regulations require that it be brought down to 6 percent.

If officials do not reduce the rate, Arizona could face penalties of $195.4 million in two years, which is more than double the amount it pays to operate the program.

Governor Blames Federal Policies

Gov. Katie Hobbs' press secretary, Liliana Soto, blamed Trump administration policies, which have increased bureaucracy and red tape on states across the country, and forced DES to take difficult but necessary steps to reduce the state's payment error rate.

Hobbs' administration is taking these steps to avoid staggering fines of hundreds of millions of dollars that would further endanger food assistance for vulnerable Arizonans, Soto said in a statement.

In December, Hobbs responded by earmarking $7.5 million in unused federal COVID-19 funds to address what she called staffing constraints at DES. That included hiring temporary workers to expand the agency's capacity to verify applicants' income.

Looking Ahead

Brett Bezio, a spokesperson for DES, said the agency is focusing on reducing the state's error rate to ensure the program remains a stable resource for vulnerable Arizonans.

It is important to note that we believe most of the impact of the changes from HR 1 has been realized, and we will begin to see consistency in the SNAP caseload in the months ahead, he said.

As other states fully implement the provisions of HR 1 and Arizona stabilizes, we expect differences in caseload decline between other states to more closely align.

Hobbs has requested an additional $48.4 million for the agency for the coming budget year, including 146 new employees. He said it should cut delays as well as help ensure the state gets below the error rate at which point there would be penalties.

But even with all that, the data the new report cites from DES shows a continued sharp decline in food stamp recipients, down from 598,852 in December to 485,460 in February.

Republican Criticism

Republican Congressman David Schweikert, however, had his own take on the sudden drop in SNAP recipients.

States were incentivized to reduce errors and manage benefits efficiently, he said of HR 1.

But he said that 10.4 percent error rate in the most recent fiscal year meant that Arizona had to do a lot more culling of ineligible recipients.

Arizona's outsized reductions are a clear outlier, demonstrating the management failures of this governor, said Schweikert, who is hoping to oust Hobbs in November.

States were incentivized to reduce errors and manage benefits efficiently. Arizona's outsized reductions are a clear outlier, demonstrating the management failures of this governor.