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Health and Human Services

The Texas Health & Human Services Commission (HHSC) is the state governmental body that administers the state's Medicaid programs, including overseeing and administering the Texas Healthcare Transformation and Quality Improvement Program 1115 Waiver (the Transformation Waiver or 1115 Medicaid Waiver). In this role, HHSC serves as the direct point of contact and negotiates on behalf of the state with the U.S. Centers for Medicare and Medicaid Services (CMS), the federal agency that approves and funds the waiver.

The state's 1115 Medicaid Waiver was designed to allow for expansion of Medicaid managed care programs while also helping to preserve federal supplemental funding historically provided to hospitals and physicians under the state's former Upper Payment Limit (UPL) program. The two programs under the 1115 Medicaid Waiver included as part of, and reported within, the state's 20 regional health care partnerships are the DSRIP program and the UC program.

Delivery System Reform Incentive Payment

The Delivery System Reform Incentive Payment (DSRIP) program makes incentive payments available for projects implemented under the Transformation Waiver. Eligible performing providers selected project options from a proscribed menu (the RHP Planning Protocol) released by HHSC and CMS with projects designed to enhance access to and availability of health care services, increase quality of existing care, improve the cost-effectiveness of care provided, and improve the health of patients and families across Texas.

Once a project has been approved by HHSC and CMS and is documented as part of an approved Regional Healthcare Partnership Plan, a provider is able to begin implementation and eligible to receive incentive payments upon successful completion of documented milestones and metrics. The 1115 Medicaid Waiver in Texas is currently classified as a demonstration waiver and runs for a five-year period (December 2011 through September 2016). Providers had the opportunity to propose four-year projects during initial waiver planning and were able to select from a modified DSRIP menu in 2013 to propose three-year projects.

The DSRIP portion of the waiver is managed by the HHSC Waiver Operations Team. Visit the HHSC Medicaid Transformation Waiver home page to learn more about the DSRIP program and to view waiver guidelines, the planning protocol, the statewide waiver timeline, as well as the RHP Plans and projects for all 20 regions across the state.

Uncompensated Care

The Uncompensated Care (UC) program, in conjunction with the implementation of the DSRIP program under the waiver, replaces the former Upper Payment Limit (UPL) program in Texas. As defined by HHSC, UPL was a system that provided supplemental payments to help cover the difference between what an eligible hospital or physician provider was paid by Medicaid and what Medicare would have paid for the same services if Medicaid were provided through managed care.

In the transition to the UC program, eligible hospital and physician providers can receive supplemental payments to help address expenses associated with the uncompensated care being provided to Medicaid-eligible individuals who have no funds or third-party coverage to assist with the health care treatment and services they receive.

The UC portion of the waiver is managed by the HHSC Rate Analysis Department. Visit the HHSC Rate Analysis Uncompensated Care Payments page to learn more about the UC program and to view the methodology and rules that govern UC along with the affiliation and payment databases maintained by the state.

Last edited by: chauhan 06/29/2018