Medicaid and state budgets: clearing storm, foggy forecast.

This issue brief examines the recent history and trends in state budgets and considers how those trends have influenced the role of the Medicaid program. The paper offers several indicators for predicting the future of states' fiscal standing, cautioning that, although the "stormy" period from 2001 to 2003 is over, states face many challenges in he near future. This issue brief also poses several questions regarding the appropriate rules of state and federal governments in administering the Medicaid program. These questions become particularly important as the population ages and states increasingly take the lead in developing solutions for covering the uninsured.