RALEIGH — North Carolina Medicaid spending is on track with the budget through the first two months of the new fiscal year after the Legislature had to provide two cash influxes last spring to narrow what became a $265 million shortfall.

State Medicaid business officer Steve Owen told lawmakers Tuesday the government health insurance plan for nearly 1.6 million residents is spending about $4 million less in state dollars compared to the forecast based on the approved budget that began July 1.

Owen said lower spending can be attributed to enrollment increases being lower than originally predicted. He said the Division of Medicaid Assistance is keeping weekly tabs on Medicaid spending because finances can change quickly.

Last year’s shortfall led to conflict between Democratic Gov. Bev Perdue’s administration and the Republican-led N.C. General Assmebly.