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Every year since 1984, Congress has expanded Medicaid to cover an increasing proportion of low-income children. In this study, a multivariate analysis of data from the 1987 National Medical Expenditure Survey was used to determine whether expanded Medicaid eligibility is likely to be effective in encouraging recommended preventive visits for low-income, preschool children. For low-income children who would otherwise be uninsured, a full year of Medicaid increased the probability of any well-child visits by 17 percentage points, and compliance with the guidelines of the American Academy of Pediatrics for well-child visits increased by 13 percentage points. The generosity of Medicaid fees did not alter the magnitude of these effects. However, even if all uninsured children under 200% of the poverty line were eligible for Medicaid, low-income children would continue to lag behind other children in their use of preventive services. Factors other than insurance and income, such as the lower educational attainment of low-income mothers, explain approximately 80% of the gap between children above and below 200% of poverty. The rate of compliance with the American Academy of Pediatrics guidelines was less than 50% for all preschool children. Departures from the recommended schedule of visits were particularly pronounced in the second year of life and may interfere with children receiving the recommended immunizations in a timely manner.