From the Washington Post today

States Freeze, Reduce Medicaid Payments


All 50 states froze or reduced Medicaid payments to health care providers such as doctors and hospitals while 43 states targeted drug costs this year, and more cost controls are on the way, according to a survey.
The measures helped states slow growth in Medicaid spending and enrollment for the third straight year, according to the survey of state directors of the government health care program for the poor, released today by the Kaiser Commission on Medicaid and the Uninsured. As a result, the gap between increases in Medicaid spending and the growth of state tax revenue narrowed to its lowest level since 1999.
The success in slowing cost increases to a pace closer to growth of tax revenue is emboldening states to plan more cuts, the survey found.

http://www.washingtonpost.com/wp-dyn/content/article/2005/10/19/AR2005101902149.html