States spend more than $200 billion annually for health care for the poor and medically needy, according to the State Budget Crisis Task Force.
Medicaid has taken up a larger share of state budgets in recent years, with the program's expenses totaling approximately one quarter of total state expenditures, according to the National Association of State Budget Officers. This has a dual effect on state budgets during economic downturns, as states face an increasing demand for Medicaid services while the revenue available to pay for those services declines. New York spends $54 billion per year on Medicaid, the most of any state.
The impact of Obamacare on state budgets remains to be seen, and governors have had varied responses to the Supreme Court decision upholding the law which would increase the number of Medicaid enrollees, but not penalize the states that do not participate.
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