Governors project negative state spending, Medicaid reductions in fiscal year 2009

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Governors project negative state spending, Medicaid reductions in fiscal year 2009
Governors project negative state spending, Medicaid reductions in fiscal year 2009
State spending is expected to decrease for the first time in 25 years this fiscal year, according to a new report. That could lead to funding cuts in services for the elderly and disabled.

The National Association of State Budget Officers, along with the National Governors Association, released a report Monday highlighting the dismal state of state finances. During the 2009 fiscal year, states expect a 0.1% decrease in spending–the first negative growth in a quarter century. State spending has increased an average of 6.4% over the last 30 years, according to the report.

States across the nation are slashing their budgets, and Medicaid cuts are typically included. South Carolina and Nevada have reduced Medicaid coverage for thousands of elderly and disabled residents. At least 12 states have cut back other Medicaid services, according to the report.