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Volume 12 Number 108
Wednesday, June 6, 2007
ISSN 1091-4021

News: Medicaid

Medicaid continued to be a major burden on state budgets in fiscal year 2007, as it has for many years, according to the Fiscal Survey of States, released June 5 by the National Governors Association and the National Association of State Budget Officers.

Medicaid accounts for about 22 percent of total state spending, while all health care spending accounts for 32 percent and is the single largest portion of total state spending, the NGA/NASBO report said.

Total spending on Medicaid, the state-federal health program for low-income people, will increase by 6.6 percent in fiscal year 2007, the report estimated.

Medicaid spending is projected to increase by an estimated 5.8 percent in governors' recommended budgets for fiscal year 2008.

Health insurance issues have become increasingly significant at the state level, with the report noting that 34 governors introduced proposals to reduce the number of uninsured residents in their states during FY 2008.

Expansion Proposals

These coverage expansion proposals include expanding the State Children's Health Insurance Program, increasing individuals' access to private insurance, using traditional Medicaid expansion, and using the flexibilities offered under the Deficit Reduction Act of 2005, along with various other state programs.

Proposed fiscal 2008 funding for these programs totals nearly $18.4 billion.

The approximate number of additional people that would be covered under governors' various proposals ranges from just 268 people to 4.8 million, the report said.

"There are 22 states that are focusing on getting universal care for children," NGA Executive Director Raymond C. Scheppach said at a news conference releasing the survey. Eleven states are seeking to expand coverage for childless adults and seven states are seeking to expand coverage for all uninsured individuals.

"It is a period of rapid change and broader health care reform," Scheppach said. If, however, revenue growth slows, a number of states will "pull back from broader initiatives."

According to the report, most states expect a steady fiscal 2008 with reasonable revenue growth, however, some states already are seeing a slowing of their revenue.

The NGA/NASBO state fiscal survey is released twice a year.

The NGA report, The Fiscal Survey of States: June 2007, is available.