In a Health Affairs web exclusive, Terri Coughlin and Stephen Zuckerman examined budget decisions in eight states over the 2003-05 time period when states faced some of their largest budget shortfalls since World War II. Coughlin and Zuckerman report that, on balance, states were reluctant to raise taxes or reduce either benefits or eligibility for Medicaid and SCHIP. Instead, they frequently relied on one-time actions such as shifting money from surplus accounts into general funds, changing accounting rules or delaying payments from one fiscal year into the next. The authors concluded that by taking this approach, however, some states have created structural deficits that will profoundly influence state policy making for many years to come. (Health Affairs Web Exclusive, August 16, 2005)
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