Despite unprecedented prosperity and unexpectedly large federal budget surpluses during the 1990s, the problem of providing health care to the uninsured has continued to expand. The ranks of the uninsured have increased from 37.5 million in 19921 to an estimated 44 million in 1997.2 The unsuccessful attempt at health care reform in 1993 signaled a policy retreat at the federal level. Rather than the sweeping reform that was expected, growth in government-sponsored health insurance coverage would be, at best, incremental. Enactment of the Title XXI Children's Health Insurance Program, as part of the Balanced Budget Act of 1997, was such an incremental measure. With a vacuum in health care policy leadership at the federal level, the baton was handed to the states.