PHOENIX - The state's health care program for the poor has agreed to pay for dialysis for about 250 legal and illegal immigrants.

In a deal announced Monday, the Arizona Health Care Cost Containment System will now consider it an emergency to provide dialysis for patients with end-stage renal disease. That is exactly what had been sought when the agency was sued.

That means if they meet the income requirements they are entitle to free treatment, even if other state and federal laws make them ineligible for AHCCCS care.

"This settlement will save lives,'' said Ellen Katz. She is th attorney for the William E. Morris Institute for Justice, a public interest law firm which sued five years ago.

The fight surrounds issues of federal regulations, as Washington picks up about two thirds of the cost of AHCCCS.

To be eligible, a person must be a U.S. citizen or have been a legal resident alien for at least five years, with income at or below the federal poverty level. That is $20,650 for a family of four.

The people affected by this case meet the income restrictions but not the citizenship or residency requirements.

Those eligibility rules, however, do not apply for emergency care: Anyone whose income is below the federal poverty level qualifies regardless of legal status.

In 2001, though, the federal government concluded that dialysis does not constitute emergency care. That resulted in AHCCCS trying to cease treatment - an action that eventually was barred by a federal judge after this lawsuit was filed.

This settlement not only ends any risk of patients being denied treatment. It also requires AHCCCS to amend its rules as well as actively notify doctors, clinics and hospitals of the right o all patients with end-stage renal failure to have the government pay for the care.

Katz said that is defined as individuals who, without dialysis, would reasonably be expected to have their health put in serious jeopardy, have serious impairment of a bodily function, o serious dysfunction of a bodily part or organ.

She said that at any given time there are about 250 people who will be affected by the settlement.

"One of the things that happens is people who need kidney dialysis, they don't go and get an actual kidney replacement, their lives are severely shortened,'' she said. "A lot of persons ultimately die.''

AHCCCS spokeswoman Rainey Holloway estimated the annual cost at close to $5.2 million.

Technically speaking, the U.S. Department of Health and Human Services, which also was sued, was not part of the settlement.

But Katz said that agency has unofficially agreed to the deal, meaning it will continue to provide two thirds of the total cost.