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Comptroller Report Shows Medicaid Spending Decrease

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A report from the New York State Comptroller’s office indicates that Medicaid spending since state fiscal year (SFY) 2003-2004 grew at a slower pace (10.8%) than inflation, and Medicaid costs actually decreased by about $1.1 billion (3.2%) between SFYs 2006-2007 and 2007-2008. The report attributes some of the Medicaid spending reduction to a decrease in eligible recipients of about 50,000 (1.2%). Savings could also be attributed to Medicaid spending reductions included in the enacted SFY 2007-2008 budget.

The state Financial Condition Report for Fiscal Year 2007-2008 provides an overview of the financial condition of the state and presents selected financial, economic, and demographic information and trends. It states that total state spending in SFY 2007-2008 grew to $116.1 billion, a 19.3% increase since SFY 2003-2004. This spending growth outpaced the rate of inflation (13.3%) over the same period.

The report notes that state source revenue collections are projected to grow only 17.3% between March 31, 2008 and March 31, 2012, as compared to spending growth of 29.3%--resulting in a spending gap of nearly $11 billion by the end of 2012.

Governor Paterson last week announced that the state is facing a $1.2 billion current-year budget deficit and is projecting this number will grow, given the economic downturn. To address the growing budget gap, the Governor is convening a special legislative session on November 18 to achieve $2 billion in savings.

The Division of Budget on October 30 will release its mid-year report as well as projected budget estimates for future years. Additional state revenue and expenditure projections will be released on November 5 when the Senate, Assembly, and Comptroller release their respective budget projections. Contact: Robin Frank

Published October 10, 2008