To be more accountable and effective, state government must have a long-term outlook, particularly regarding its finances. CPAT’s Economic and Caseload Forecasting Unit is helping state government develop that perspective by:
- Setting Long-Term Fiscal Policy – in May 2012, the unit published the state’s first Long-Term Fiscal Policy Framework, which includes five-year tax revenue forecasts developed in consultation with outside economists. This framework is being updated regularly to account for economic and fiscal changes;
- Forecasting and Reporting Benefit Caseloads – two caseload forecasting reports have been provided to the legislature looking at state-subsidized services, such as Medicaid and emergency assistance housing programs. Collaboration with MassHealth, which administers Medicaid, has helped them update their forecasting methodology. The unit has also supported DTA in improving its forecasting accuracy. A new caseload report will be provided to the legislature in March of this year; and
- Evaluated the Economic Impact of the “Fiscal Cliff” – working jointly with CPAT’s FGMO, analysis was conducted to assess the impact of federal funding cuts on state programs and the state’s economy, tax revenues and overall fiscal health. This analysis is being updated to assess the outcomes from budget negotiations in Washington.
The Economic and Caseload Forecasting Unit will work to expand the Long-Term Fiscal Policy Framework, including estimating the impact of further federal deficit reduction policies and Affordable Care Act implementation. The unit also is taking on responsibilities related to the health care cost containment legislation in forecasting economic growth.