April 6, 2011Ladies and Gentlemen:Most Texans know that our state government faces signiﬁcant ﬁnancial challenges today. As Comptroller, it’s my duty to watch trends that a
ect our bottom line. One of the mostimportant forces driving the current ﬁscal crunch is the spiraling cost of health care services. As a contribution toward understanding and exploring this pressing issue, I hope you will ﬁndour new report,
State Health Care Spendin
g, a helpful resource.In ﬁscal 2009, more than 50 Texas state agencies spent more than
in state, federaland other funds on health care, including Medicaid payments, mental health services, employeehealth insurance and health care for prisoners.
at’s more than a third of all state spending.
ese costs are mounting at an alarming rate.In the ﬁve years between ﬁscal 2005 and 2009, Texas’ health care costs leaped by 36.1 percent— nearly four times as fast as the inﬂation rate, and more than
as fast as the state’spopulation growth.
is report examines the factors behind this surge, examining expenditures by agency andidentifying major cost drivers for each.
e report also provides recommendations that couldhelp the state begin to address these skyrocketing costs.By taking steps now, we can more e
ectively contain rising costs while maintaining vital healthcare services for all Texans.Sincerely,Susan Combs