The Centers for Medicare and Medicaid Services (CMS) has informed state Medicaid directors that it does not anticipate approving new state proposals of section 1115 demonstration expenditure authority for federal designated State Health Plan (DSHP) or Designated State Investment Program funding or renewing current approved Demonstration projects.
States benefit from 1115 demonstration projects as CMS provides federal matching funds for state expenditures for DSHP and DSIP that advance the Medicaid program. CMS’ refusal to continue to share in the costs of funding these DSHP programs will place an additional financial burden on states. In Massachusetts, federal funding for DHSP programs is authorized through the end of 2027 for a variety of community health and home care programs, with an estimated $300 million in federal matching fund at risk.