By Jonathan Eberle |

Arizona Governor Katie Hobbs announced Wednesday that two of her top health officials, AHCCCS Director Carmen Heredia and Department of Health Services Director Jennie Cunico, have resigned after it became apparent that the Republican-controlled state Senate would not confirm their appointments.

The resignations come amid a broader struggle between the governor’s office and the state Senate’s Director Nominations Committee, chaired by Republican Senator Jake Hoffman. The committee has become increasingly assertive in vetting Hobbs’ executive agency nominees, and in recent weeks signaled it would reject both Heredia and Cunico. Hobbs’ office said the resignations were necessary due to the Senate Majority’s unwillingness to confirm them.

“Today’s announcement is a testament to the important work being conducted on behalf of the citizens of Arizona by the Senate Committee on Director Nominations. I’m pleased Katie Hobbs saved herself, and AHCCCS Director Nominee Carmen Heredia, from the embarrassment of advancing her through the scheduled hearing this week,” said Senate Director Nominations Committee Chair Jake Hoffman. “Under Heredia’s direction, AHCCCS mismanaged the procurement process and improperly awarded contracts for healthcare services for thousands of elderly and physically disabled individuals enrolled in the Arizona Long Term Care System. A judge described the process as ‘arbitrary and capricious’ and recommended a full reset. Instead of responding to the feedback appropriately, Heredia basically told the judicial system to pound sand and moved forward with the contracts. Her refusal to provide transparency in this matter displayed nothing more than arrogance.”

“What’s even worse, Arizona is in the middle of a monumental Medicaid fraud crisis with a loss of more than $2 billion in taxpayer dollars,” continued Hoffman. “Under Katie Hobbs’ leadership, Heredia’s response has been incredibly disturbing, to say the least. Patients in sober living homes were evicted from facilities overnight after AHCCCS poorly executed suspensions of more than 300 providers. Many of these patients were mid-treatment, detoxing, or severely mentally ill and were dropped off on the streets with no identification or transportation. Legitimate providers were caught up in the mess without AHCCCS providing explanations or due process. Some are still waiting to be reinstated or reimbursed. We are left with a broken system due to Heredia’s mismanagement, and our vulnerable populations are caught up in this collapse.”

“Since its inception, the Committee on Director Nominations has been committed to honestly, thoroughly, and accurately vetting Katie Hobbs’ nominees. We have served as Arizonans’ last line of defense against incompetent, unqualified, and highly partisan picks to lead state agencies. We will continue to do the hard work the citizens of Arizona expect of us and will only approve competent, non-partisan individuals to serve in these critical roles,” stated Hoffman. “We look forward to Katie Hobbs sending us a sensible leader that will be able to rein in the abuse that has occurred at AHCCCS.”

Heredia, who led the Arizona Health Care Cost Containment System (AHCCCS) since early 2023, was credited by Hobbs with implementing sweeping reforms that led to nearly $1 billion in Medicaid fraud recoveries and savings over three years. She expanded access to care for working-class children, oversaw transitions to employer-sponsored insurance, and spearheaded behavioral health initiatives such as the Housing and Health Opportunities program.

However, Heredia’s leadership was the subject of fierce criticism from Senate Republicans. Senator Hoffman accused her of mismanaging Medicaid contracts and overseeing what he called a “broken system” during Arizona’s recent Medicaid fraud crisis. The Senate committee never formally held a confirmation hearing for Heredia, but it became clear she lacked the votes needed.

In her resignation letter, Heredia said, “It has become increasingly difficult to carry out this mission in good faith under the current political climate… Political theater has begun to outweigh sound policy.”

Cunico, a career public servant who transitioned from the Ducey administration also became ensnared in the Senate’s broader dispute over executive appointments. “It is clear to me that there is no path forward to confirmation,” Cunico said in her statement.

The latest resignations reflect a deepening power struggle between the Democratic governor and the Republican-led Legislature. Hobbs condemned what she called an “unprecedented politicization” of the confirmation process, warning that the climate in the Capitol is deterring qualified public servants.

“These resignations were not due to a failure in governance, but a failure in politics,” Hobbs said. “The people of Arizona deserve leaders who are judged by their performance, not their party.”

As the governor seeks replacements for both roles, it remains unclear how future nominees will fare in a process increasingly shaped by ideological divisions.

Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.