State spending on Medicaid expected to significantly slow in short term

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Growth in state spending on the Medicaid program is expected to fall significantly in the short term, according to a new report by state budget officers. The findings, published Thursday in a report from the National Association of State Budget Officers, or NASBO, show that state Medicaid spending is expected to carry a median growth rate of 4.5 percent in fiscal 2018, and then growth is projected to slow significantly in fiscal 2019, to a median growth rate of 1.5 percent. The organization uses governors’ budgets in making its assessments. In the long term, however, healthcare costs are expected to grow faster than revenue, which will put additional strain on state budgets. Medicaid is the second-largest expenditure in most states, and in future years, the program is expected to grow closer to historic levels of 5.5 percent, according to the federal government’s Congressional Budget Office.