Medicaid has become one of the most hotly debated issues in health reform. Almost all agree that reform is badly needed. In Congress, it has become a numbers game about millions of people and billions of dollars. One side decries the poor health outcomes that will derive from people losing coverage; the other argues that Medicaid desperately needs reform, not only to serve today’s recipients but also to effect solvency for future generations. Many are being told that empowering the federal government further is the way forward; conversely states, both red and blue, feel they can better serve their citizens if they were given more flexibility in managing Medicaid. How Medicaid is reformed is critical to the future of health care reform because it will form the template for the design of Medicare and private insurance going forward.

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