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In 2005, Missouri adopted sweeping Medicaid cutbacks. More than 100,000 people lost coverage, and many more faced reduced benefits and higher cost-sharing. Using a range of data sources, we show that the cutbacks were followed by a major increase in the numbers of uninsured people, greater uncompensated care burden on hospitals, and revenue shortfalls that forced community health centers to obtain larger state grants and charge patients more. Competing demands on state budgets and the need to balance budgets even during recessions could result in policies that disadvantage those with great needs as well as the providers who serve them.