DES; credentialing; application; deficiencies

Plain English Breakdown

The official text states the law becomes effective on the 'general effective date,' but does not specify a calendar date or time frame beyond the rule adoption deadline of June 30, 2027.

SB1632: Rules for Fixing Denied DES Credential Applications

This law requires the Department of Economic Security (DES) to give applicants whose credentialing or recredentialing applications were denied a chance to fix specific errors within 14 business days and have their application reviewed again.

What This Bill Does

• Requires DES to allow an applicant whose credentialing or recredentialing application was denied the opportunity to correct any deficiencies that caused the denial.
• Gives applicants 14 business days after receiving a denial notice to fix those errors.
• Mandates that if an applicant notifies DES in writing within the 14-day period that they have fixed all deficiencies, DES must reevaluate the application.
• Allows an applicant to appeal through administrative hearings if DES denies the application again and does not start a contract within 14 business days after the new review.
• Requires DES to create official rules for this correction process by June 30, 2027.

Who It Names or Affects

• Individuals or agencies applying to become qualified vendors with the Department of Economic Security (DES) under developmental disabilities programs.
• The Division of Developmental Disabilities within DES.

Terms To Know

Credentialing

The process where DES checks if a vendor meets all rules and standards needed to sign a contract for providing services under section 36-557.

Deficiencies

Missing information or errors in an application that cause it to be denied.

Limits and Unknowns

• This law only applies if the denial was caused by fixable deficiencies in the application.
• Applicants must notify DES in writing within 14 business days that they have fixed the problems; otherwise, this process does not apply.
• The specific rules for how applicants will submit corrections are not yet written and must be created by June 30, 2027.

Official Summary Text

SB1632 - 572R - Senate Fact Sheet

Assigned to
HHS�������������������������������������������������������������������������������������������������������������� AS
PASSED BY COW

ARIZONA STATE SENATE

Fifty-Seventh
Legislature, Second Regular Session

AMENDED

FACT SHEET FOR
S.B. 1632

DES;
credentialing; application; deficiencies

Purpose

Requires the
Department of Economic Security (DES) to grant an applicant whose credentialing
or recredentialing application was denied 14 days to correct any application
deficiencies that led to the denial and an opportunity for reevaluation of the
application.

Background

DES requires
individual providers and provider agencies to apply to become a DES qualified
vendor as a condition of contracting to provide services through the Division
of Developmental Disabilities (DDD). Applicants must submit specified
information and documentation demonstrating eligibility and ability to provide
program services, which DES reviews to determine whether the applicant may be
authorized to provide program services. If a qualified vendor application is
denied, the applicant may protest the denial and appeal the decision through an
administrative appeals process

(
DES
;

6 A.A.C. 6
art. 21
).

There is no
anticipated fiscal impact to the state General Fund associated with this
legislation.

Provisions

1.

Requires DES to give an applicant whose credentialing or recredentialing
application was denied an opportunity to correct any application deficiencies
that led to the denial.

2.

Grants an applicant 14 days to correct any deficiencies after receiving
an application denial notice.

3.

Requires DES to reevaluate a credentialing or recredentialing
application denial for an applicant that corrects all application deficiencies
within 14 days after receiving a denial notice.

4.

Stipulates
that, if DES denies an application after reevaluation and does not initiate a
contract within 14 business days, the applicant may appeal the decision through
the statutory administrative hearings and appeals process.

5.

Requires DES to adopt rules to implement the credentialing deficiency
correction process by June 30, 2027.

6.

Defines
credentialing
as the process of verifying the
qualifications, standards and any other requirements a vendor must have to be
eligible to contract with DES to provide services to DES program recipients.

7.

Becomes effective on the general effective date

Amendments Adopted by Committee of the Whole

1.

Expands the credentialing deficiency correction process to apply to any
applicant, rather than only qualified vendors.

2.

Grants DES 14 business days after denying a corrected credentialing
application to initiate a contract before an applicant may appeal the decision
through the statutory administrative hearings and appeals process.

3.

Requires DES to adopt rules to implement the credentialing deficiency
correction process by June 30, 2027.

Senate Action

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Prepared by Senate Research

March 9, 2026

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Current Bill Text

SB1632 - 572R - S Ver

Senate Engrossed

DES; credentialing;
application; deficiencies

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SENATE BILL 1632

AN
ACT

Amending Title 41, chapter 14, article 1,
Arizona Revised Statutes, by adding section 41-1971; relating to the department
of economic security.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it
enacted by the Legislature of the State of Arizona:

Section 1. Title 41, chapter 14, article 1,
Arizona Revised Statutes, is amended by adding section 41-1971, to read:

START_STATUTE
41-1971.

Credentialing applications; developmental disabilities services;
deficiencies; denial; appeal; rules; definition

A. if the department
denies
An
application for
CREDENTIALING or
an
APPLICATION for
recredentialing, the department shall give the
applicant
an OPPORTUNITY to
correct any DEFICIENCIES with the application that led to the INITIAL denial. �The

applicant
has fourteen
business days after receiving the notice of DENIAL from the department to
correct the DEFICIENCIES. �If the
applicant
notifies the
department in writing within the fourteen-day period that the
deficiencies have been corrected, the department shall reevaluate the
credentialing or reCREDENTIALING application.

B. If after
reevaluation
, the department
denies the application
and does not initiate a contract within fourteen
business days
,
the
applicant
may appeal the
decision pursuant to Article 3 of this chapter.

C. on or before june
30, 2027, the department shall adopt rules to implement this section.

d.
for the purposes of
this section
,

"CREDENTIALING" means the process of verifying the qualifications,
standards and any other requirements a vendor must have to be ELIGIBLE to
contract with the department to provide services
pursuant to section 36-557
.
END_STATUTE