As the new century begins, the Medicaid program is arguably at a political crossroads. Over the 1980s and 1990s, policy makers enacted major expansions in Medicaid coverage, offering significant new health benefits to poor women and children and other constituencies. In elite rhetoric and political framing, Medicaid was increasingly cast as a broad-based social welfare entitlement of value to all Americans, including middle-class citizens. Some health care advocates began viewing Medicaid expansions as a potential path to achieving universal coverage in the United States. Yet Medicaid remains a means-tested program that has been repeatedly threatened with policy retrenchment. In this essay, we scrutinize Medicaid's current status and future possibilities from a historical-institutional perspective by tracing its complex evolution since its enactment in the Social Security Amendments of 1965. Our core claim is that decisions made at the time of Medicaid's original adoption have fundamentally set the matrix for struggles over the program's unfolding development. We demonstrate that key ambiguities embedded in the 1965 act created largely unintended opportunities for policy entrepreneurs to broaden Medicaid's scale and scope as well as foreseeable vulnerabilities that must be overcome if Medicaid is to realize its full potential.

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