Question-and-Answer Session
Operator
(Operator instructions) Our first question comes from the line of Kevin Ellich [ph]. Please go ahead.
Kevin Ellich
Hi, good morning guys. Thanks for taking my questions.
Ralph Gronefeld
Good morning Kevin.
Kevin Ellich
Ralph, first of all I was wondering if you could comment about the economic impact on the business and what you are seeing from the state funding or government funding side of the business?
Ralph Gronefeld
Well for 2008 as I mentioned in the last call the rate environment is really in our rearview mirror. States (inaudible) decision about their budgets going through end of 2009. Again it doesn’t mean that at some point they are going to call a special session and look at doing something different, cutting rates or cutting services, but we have got no indication of that at this point in time. We understand that states are having financial difficulties. In the last report that I’ve seen a recently I think 39 of the 52 states are having budgetary shortfalls. We continue to work hard at the grassroots level to make sure that legislatures and folks within the state understand, our customers understand the needs for our services in the populations that we serve. We will continue to do that. We continue to be proactive in monitoring this situation and as we see indications that our services are being mentioned in any way either through our provider associations or through our lobbying efforts or through our operations we make contact again to help educate and to make sure folks understand the impact that it would have on our services and the quality of services and the people of the state are responsible to support.
So where we are right now is where we thought we would be from a rate environment standpoint for 2008. 2009 as is not as clear. But at the current time we have got no indication that we’re going to see any significant other rate reductions at this time. But we also don’t believe we’re going to see any significant rate increases. So, we’re kind of in that flat range again for our second year and as soon as we get more visibility or clarity and we’ll be more than happy to update you folks. But right now it is business as usual in just making sure that we continue to communicate and listen and be proactive in making sure that payer sources understand our services and how important they are.
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