In this paper we argue that there is a real need for Medicaid
reform primarily because of the large differences among states
in coverage and benefits and because of the program's high and
rising costs. We describe and develop several options for Medicaid
reform that would expand coverage, provide fiscal relief to
states, shift responsibility for some or all of the care of
dual eligibles to the federal government, and eliminate or restructure
disproportionate-share hospital (DSH) payments. We conclude
with a discussion on a number of other issues, particularly
Medicaid cost containment and the federal matching payment structure
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