Abstract
Medicaid spending has become a major element in state budgets and support from federal Medicaid grants is now a main source of state government funding. We discuss recent, ongoing, and prospective reforms of intergovernmental finances and regulations, including the 1996 welfare reform, the introduction of Medicare Part D, Section 1115 waivers, SCHIP reauthorization, and a shift to block grant funding for Medicaid. Each would alter the current assignment of responsibilities between the state and federal governments, the viability of which is questionable due to current and future interstate demographic and policy variation, population aging, and federal fiscal imbalances.
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