MEXs	is nominal spending on Medicaid in State s;
Ps	is our Medicaid price deflator that puts spending in real terms;
RIs	is a recipient costliness index to adjust State spending for differences in the health status of the poor (described below);
POORs	is the number of poor people in the sth State; and
B*	equals a predetermined optimal level of Medicaid benefits, assumed constant across all States to achieve horizontal equity to recipients.