Since ratification of the U.S. Constitution, relations among state governments and the national government have grown to be much more interdependent. Whereas states once enjoyed greater autonomy (dual federalism), the additional demands placed on government (at all levels) has fostered an evolution of federalism, whereby the federal government now plays a much more pronounced role in local and state affairs, with respect to a whole host of issues (including healthcare, education, public safety, transportation, etc.).

1. Describe block grants, categorical grants, and unfunded mandates. How do they demonstrate fiscal federalism?
2. Explain which funding mechanism states prefer. Why? Which funding mechanism does the federal government prefer? Why?
3. Describe how both state and federal governments participate in the provision of medical care to low-income residents.
4. In Arizona, low-income residents receive healthcare coverage through the Arizona Health Care Cost Containment System (AHCCCS). How is AHCCCS funded (e.g., categorical grants)? What are the eligibility requirements, and who sets them? How do the basic conditions set by the federal government constrain AHCCCS?
5. Assess the effectiveness of federal aid to state and local communities, particularly as it relates to healthcare coverage.