Financing Medicaid: federalism and the growth of America's health care safety net

Abstract

Conventional wisdom holds that programmes for the poor are vulnerable to instability and retrenchment. Medicaid, however, has grown into the nation's largest intergovernmental grant program, accounting for nearly half of all federal funding to state and local governments. Medicaid's generous open-ended federal matching grants have given governors a powerful incentive to mobilise on behalf of its maintenance and expansion, using methods ranging from lobbying and negotiation to creative financing mechanisms and waivers to maximise federal financial assistance. Perceiving federal retrenchment efforts as a threat to states' finances, governors, through the powerful National Governors' Association, have repeatedly worked together in bipartisan fashion to defend the programme against cutbacks. Financing Medicaid engagingly intertwines theory, historical narrative, and case studies, drawing on sources including archival materials from the National Governors' Association and gubernatorial and presidential libraries, Centers for Medicare and Medicaid Services data, the Congressional Record, and interviews.