Don't Count Your Budgetary Chickens Before They Hatch

Governor Martin O'Malley rolled out his FY11 state budget in January claiming to have balanced the budget with federal stimulus funds and one-time fund swaps to erase his $2 billion deficit. Upon closer inspection, however, legislators realized that O'Malley's balancing act includes almost $400 million of federal Medicaid funds that have not been appropriated.

Last week, Congressman Steny Hoyer spoke from the State Senate rostrum and advised the legislators to develop a Plan B for that $400 million. Nice trick by O'Malley - now that the General Assembly has the budget, it is their job to cover his phantom $400 million.

Maryland's overspending in Medicaid is in part due to O'Malley expansion of benefits during a recession according to Marc Kilmer of the Maryland Public Policy Institute. In a opinion piece published today, Kilmer states, "Spending has increased dramatically in recent years and will continue to do so because those in Annapolis lack the political will to reform a broken system. Instead of looking for ways to control Medicaid's growth, the governor and legislators expanded the program in 2007. While other states, such as Florida and Georgia, were restructuring their Medicaid programs to contain costs, Maryland policymakers preferred to ignore the problems in the system."

To read Kilmer's entire article click here.

In a second article entitled "O'Malley's Big Spending Budget," Kilmer provides basic budget facts that counter the spin that comprises the O'Malley messaging on the state budget - click here.