The Kaiser Family Foundation (KFF) released a brief examining state Medicaid agencies' approaches to implementing health reform.  The brief is based on interviews KFF conducted with directors of Medicaid agencies.

From the report: The recession continues to impact state Medicaid programs. Even as the overall economy begins to recover, Medicaid caseload and spending growth remain high, state revenue growth remains weak and almost all states are likely to continue to face budget gaps and shortfalls heading into SFY 2011 and beyond because it could take several years for revenues to return to pre‐recession levels. More than half of the states assume an extension of the ARRA enhanced FMAP through June 30, 2011 (an additional six months) in the SFY 2011 budget. However, the passage of the FMAP increase and timing of that measure by Congress remains uncertain, which could force these states to make additional budget cuts to meet balanced budget requirements if the funds expire mid‐way through SFY 2011. Several attempts to extend these funds has been unsuccessful and the level of financing available has declined from about $24 billion to about $16 billion in last proposal considered.

Full report: State Medicaid Agencies Prepare for Health Care Reform While Continuing to Face Challenges from the Recession (PDF | 410KB)

Kaiser Family Foundation.  (2010).  State Medicaid agencies prepare for health care reform while continuing to face challenges from the recession.