Medicaid costs offset state revenue gains
A new report by the National Governors Association shows that revenue for states will creep up slightly, but that much of those gains will be offset by escalating Medicaid costs, reports The Washington Post.
The report concluded that Medicaid will likely be the only state program to receive funding increases, driven in part by more enrollees, less help from the federal government, and continuing spikes in costs.
Medicaid spending grew by 7.9 percent in fiscal 2010. The report forecasts growth of 11.2 percent in fiscal 2011.
The forecast calls for a modest increase in overall state general fund revenue in 2012, although it will remain $21 billion below 2008 levels. However, state funds toward Medicaid spending will increase as much as 18.6 percent, while federal funds will decrease 13 percent. Much of that change is the result of stimulus funding for the Medicaid program coming to an end.
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