Background Paper

Medicaid's Disproportionate Share Hospital Program: Complex Structure, Critical Payments
September 14, 2004


Robert E. Mechanic, Consultant


This background paper describes the history and political evolution of Medicaid’s disproportionate share hospital (DSH) program and examines DSH as it exists today. It highlights the importance of DSH payments for the viability of safety net hospitals and considers the consequences of states’ creative financing strategies for maximizing federal Medicaid matching funds. Finally, this paper reviews several options for improving the structure and effectiveness of the DSH program.

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See also "Medicaid Financing" (The Basics, January 5, 2016).

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