Monday, February 14, 2005

How the state balanced the budget in 2003:

by cutting state services and subsequently stunting economic growth.

From a recent Houston Chronicle article

Health care cuts brought side effects: '03 slashes hurt Texas' economy, but facility closure isn't the answer, studies find

State health care budget cuts in 2003 cost the state economy as much as $16 billion in lost productivity, stunted employment growth by about 70,000 jobs and shifted at least $1.5 billion in costs to local taxpayers


Major cuts were made in state services in 2003 as lawmakers tried to balance a budget with a $10 billion deficit without raising taxes. This year state revenues are about adequate to maintain current services, but pressure is growing to restore almost $1 billion in health care cuts made two years ago while also recognizing the potential for growth in the client population.

The budget cut about 250,000 low-income children from the Children's Health Insurance Program and 365,000 more from health care coverage through Medicaid for the poor.


The hospital association study, which focused on state health care funding that impacts hospitals, found the cuts cost the state economy about $8.4 billion in the past two years and dramatically stunted job growth.


[The mental health study] said the cost to Texas runs to about $16 billion a year when the impact of inadequate care for 4 million mentally ill Texans and the effect on their families of lost time and work and wages is studied

1) Perryman's report for the Texas Hospital Association

2) Mental Health Association in Texas report [PDF]


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