This State Health Research and Policy Interest Group Breakfast, held February 3, 2009, addressed state approaches to improving quality while cutting costs. Panelists were Trish Riley, Director, Governor's Office of Health Policy and Finance, Maine; Philip W. Magistro, Director, IT, Governor's Office of Health Care Reform, Pennsylvania; and Aaron McKethan, Ph.D., Research Director, The Engelberg Center for Health Care Reform, The Brookings Institution. The event was sponsored by The Commonwealth Fund, the Georgia Health Policy Center, and Robert Wood Johnson Foundation's State Coverage Initiatives.