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During the late 1990s, New York began to address the state's large and growing uninsured population. The state expanded coverage to children through the Child Health Plus program and Medicaid expansions. More recently, New York expanded coverage to adults through the Family Health Plus and Healthy New York programs. New York has been phasing in enrollment of over two million Medicaid recipients into managed care on a mandatory basis. As of May 2001, approximately 34 percent of those eligible for Medicaid managed care were enrolled. Implementation of mandatory managed care has moved more slowly than anticipated for several reasons. These include: sensitivity around past marketing abuses in New York City, the exit of several Medicaid managed care plans, and lack of support from hospitals-related to plans' and hospitals' perception that the Medicaid capitation rates are too low. New York is faced with the important challenge of enrolling and retaining eligible populations in the new insurance coverage programs. Rising Medicaid expenditures, the current recessionary environment, and the impact of the September 11th attacks on the World Trade Center are likely to complicate this challenge.