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State fiscal conditions continued to improve in 2012, although many state budgets have not recovered to prerecession levels. Revenues from corporate income taxes remain down nearly 25 percent over 2008 levels when adjusted for inflation. Between 2008 and 2012, three states—Illinois, Oregon and West Virginia—raised corporate income tax rates, while five states— Kentucky, New York, North Dakota, Massachusetts and Maryland—lowered rates. During this same time period, states had to rely less on corporate income taxes in their general fund budgets; revenue from those taxes are estimated to make up about 6.4 percent of general fund revenue in 2012, lower than the 7.6 percent they comprised in 2008.

Forty-three states and the District of Columbia saw an increase in real gross domestic product in 2011, a modest slowdown compared to 2010. Each region performed differently, with several states posting more than a 4 percent gain and one state posting a 7.6 percent gain. Most states fell between a 0.03 percent and a 3.3 percent growth rate from 2010 to 2011.

Medicaid expenditure growth is an important factor in states’ decisions on Medicaid eligibility expansion in 2014. On average, state Medicaid expenditures grew 20.4 percent between 2007 and 2011. Regional growth rates, however, varied greatly: the West region growth was almost twice as high as the national rate at 41.7 percent; the South rate was just 8.4 percent, and the Midwest and East were slightly less than the national average. The brief series provides regional and state Medicaid growth rates on two different measures: Medicaid expenditures, adjusted for inflation, 2007-2011 and Medicaid expenditures as a percent of total state expenditures.   

Per capita health care spending and Medicaid spending per enrollee vary widely by state. According to 2009 data, Alaska, which spent the most on Medicaid, spent more than twice that of California, which spent the least. State spending for Medicaid continues to grow, consuming one third of the Missouri state budget, but just 7 percent of the Wyoming state budget in 2010.  Regional and state data are provided in this brief on per capita health spending, Medicaid spending, and Medicaid enrollment. 

According to the Census Bureau, 49.9 million people – or around 16.3 percent of the U.S. population – were without health insurance coverage in 2010. The percentage of the population that is uninsured that has been dropping for 10 years.  The percentage of insured residents ranges significantly across states, regions, age groups, racial and ethnic groups and income levels.

States have received a significant influx in federal dollars since the Great Recession began, primarily from the American Recovery and Reinvestment Act. As a result, state spending from federal funding also has increased significantly since the 2008 fiscal year, hitting 35 percent in fiscal year 2010. The amount of federal funding received per capita varies across states due to a number of factors. State spending from federal sources likely will decrease as Recovery Act dollars run out during the next few years, contributing to fiscal stress in statehouses across the country.