States Respond to Fiscal Pressure: State Medicaid Spending Growth and Cost Containment in Fiscal Years 2003 and 2004

September 2003 States Respond to Fiscal Pressure: State Medicaid Spending Growth and Cost Containment in Fiscal Years 2003 and 2004States are beginning what is for some the fourth consecutive year of fiscal stress. State tax revenues declined significantly in 2002 and remained at that low level throughout 2003. As they completed their 2003 fiscal year and developed budgets for fiscal year 2004, states faced total budget shortfalls of at least $70 billion. To close these large budget gaps, states reduced planned spending and some began to raise taxes and fees. After the beginning of fiscal year 2003, states reduced budgeted . . .