FY2023 Proposed State Budget Profile
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This summary focuses on states’ overall proposed budgets as well as their specific proposed Medicaid spending plans and program changes for Fiscal Year 2023 (FY2023). As of the date of this publication, thirty-four states and Washington, D.C are slated to enact annual budgets for FY2023. Sixteen states enacted biennial budgets in 2021, and six of those states have proposed amendments to their FY2022 or FY2023 biennial budgets but did not release new budget documents. Proposed budgets often include governors’ “wish list” items, and these budgets will continue to transform as they make their way through the legislature and back to the governors’ desks for enactment.
Most of the states that released FY2023 budgets reported significant surpluses due to unspent COVID-19 relief funds. However, state spending initiatives vary substantially. Some states propose to strengthen their rainy day and emergency funds, while others are considering investments in short- and long-term initiatives such as transportation, public safety, and infrastructure. Some states are considering investments in health-related spending initiatives such as rural health, something that explicitly aligns with CMS’s pledge to work with rural communities to determine barriers to care while building on technological and other advancements, but very few have proposed to invest their remaining COVID-19 relief funds in COVID-19 related initiatives. On average, proposed total budget amounts for FY2023 increased 10.95% over the FY2022 enacted budgets, despite a 2.74% decrease in the total Medicaid/health care spending for FY2023 over the FY2022 enacted budgets.
States with executives aligned with the Democratic party leaned into Medicaid expansion opportunities, opening new coverage options and extending the duration of Medicaid postpartum coverage. States with executives aligned with the Republican party generally did not decrease Medicaid funding, but many opted not to adjust Medicaid spending at all from their states’ previous enacted budgets.
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