--- kind: "section" citation: "42 U.S.C. § 1396r–4" title: "42" title_heading: "The Public Health and Welfare" number: "1396r–4" heading: "Adjustment in payment for inpatient hospital services furnished by disproportionate share hospitals" release: "119-102" date: "2026-07-12" url: "https://uscodex.org/usc/42/1396r-4" units: - "Chapter 7 — Social Security" - "Subchapter XIX — Grants to States for Medical Assistance Programs" --- # §1396r–4. Adjustment in payment for inpatient hospital services furnished by disproportionate share hospitals - (a) **Implementation of requirement—** - (1) A [State](/usc/42/619.md?p=5) plan under this subchapter shall not be considered to meet the requirement of [section 1396a(a)(13)(A)(iv) of this title](/usc/42/1396a.md?p=a-13-A-iv) (insofar as it requires payments to [hospitals](/usc/42/300s–3.md?p=1) to take into account the situation of [hospitals](/usc/42/300s–3.md?p=1) which serve a disproportionate number of [low income](/usc/42/701.md?p=b-2) patients with special needs), as of July 1, 1988, unless the [State](/usc/42/619.md?p=5) has submitted to the [Secretary](/usc/42/1301.md?p=a-6), by not later than such date, an amendment to such plan that— - (A) specifically defines the [hospitals](/usc/42/300s–3.md?p=1) so described (and [includes](/usc/42/1301.md?p=b) in such definition any disproportionate share [hospital](/usc/42/300s–3.md?p=1) described in [subsection (b)(1)](#b-1) which meets the requirements of [subsection (d)](#d)), and - (B) provides, effective for inpatient [hospital](/usc/42/300s–3.md?p=1) services provided not later than July 1, 1988, for an appropriate increase in the rate or amount of payment for such services provided by such [hospitals](/usc/42/300s–3.md?p=1), consistent with [subsection (c)](#c). - (2) - (A) In order to be considered to have met such requirement of [section 1396a(a)(13)(A) of this title](/usc/42/1396a.md?p=a-13-A) as of July 1, 1989, the [State](/usc/42/619.md?p=5) must submit to the [Secretary](/usc/42/1301.md?p=a-6) by not later than April 1, 1989, the [State](/usc/42/619.md?p=5) plan amendment described in [paragraph (1)](#a-1), consistent with [subsection (c)](#c), effective for inpatient [hospital](/usc/42/300s–3.md?p=1) services provided on or after July 1, 1989. - (B) In order to be considered to have met such requirement of [section 1396a(a)(13)(A) of this title](/usc/42/1396a.md?p=a-13-A) as of July 1, 1990, the [State](/usc/42/619.md?p=5) must submit to the [Secretary](/usc/42/1301.md?p=a-6) by not later than April 1, 1990, the [State](/usc/42/619.md?p=5) plan amendment described in [paragraph (1)](#a-1), consistent with subsections [(c)](#c) and [(f)](#f), effective for inpatient [hospital](/usc/42/300s–3.md?p=1) services provided on or after July 1, 1990. - (C) If a [State](/usc/42/619.md?p=5) plan under this subchapter provides for payments for inpatient [hospital](/usc/42/300s–3.md?p=1) services on a prospective basis (whether per diem, per case, or otherwise), in order for the plan to be considered to have met such requirement of [section 1396a(a)(13)(A) of this title](/usc/42/1396a.md?p=a-13-A) as of July 1, 1989, the [State](/usc/42/619.md?p=5) must submit to the [Secretary](/usc/42/1301.md?p=a-6) by not later than April 1, 1989, a [State](/usc/42/619.md?p=5) plan amendment that provides, in the case of [hospitals](/usc/42/300s–3.md?p=1) defined by the [State](/usc/42/619.md?p=5) as disproportionate share [hospitals](/usc/42/300s–3.md?p=1) under [paragraph (1)(A)](#a-1-A), for an outlier adjustment in payment amounts for medically necessary inpatient [hospital](/usc/42/300s–3.md?p=1) services provided on or after July 1, 1989, involving exceptionally high costs or exceptionally long lengths of stay for individuals under one year of age. - (D) A [State](/usc/42/619.md?p=5) plan under this subchapter shall not be considered to meet the requirements of [section 1396a(a)(13)(A)(iv) of this title](/usc/42/1396a.md?p=a-13-A-iv) (insofar as it requires payments to [hospitals](/usc/42/300s–3.md?p=1) to take into account the situation of [hospitals](/usc/42/300s–3.md?p=1) that serve a disproportionate number of low-income patients with special needs), as of October 1, 1998, unless the [State](/usc/42/619.md?p=5) has submitted to the [Secretary](/usc/42/1301.md?p=a-6) by such date a description of the methodology used by the [State](/usc/42/619.md?p=5) to identify and to make payments to disproportionate share [hospitals](/usc/42/300s–3.md?p=1), [including](/usc/42/1301.md?p=b) children’s [hospitals](/usc/42/300s–3.md?p=1), on the basis of the proportion of low-income and medicaid patients ([including](/usc/42/1301.md?p=b) such patients who receive benefits through a managed care entity) served by such [hospitals](/usc/42/300s–3.md?p=1). The [State](/usc/42/619.md?p=5) shall provide an annual report to the [Secretary](/usc/42/1301.md?p=a-6) describing the disproportionate share payments to each such disproportionate share [hospital](/usc/42/300s–3.md?p=1). - (3) The [Secretary](/usc/42/1301.md?p=a-6) shall, not later than 90 days after the date a [State](/usc/42/619.md?p=5) submits an amendment under this subsection, review each such amendment for compliance with such requirement and by such date shall approve or disapprove each such amendment. If the [Secretary](/usc/42/1301.md?p=a-6) disapproves such an amendment, the [State](/usc/42/619.md?p=5) shall immediately submit a revised amendment which meets such requirement. - (4) The requirement of this subsection may not be waived under [section 1396n(b)(4) of this title](/usc/42/1396n.md?p=b-4). - (b) **Hospitals deemed disproportionate share—** - (1) For purposes of [subsection (a)(1)](#a-1), a [hospital](/usc/42/300s–3.md?p=1) which meets the requirements of [subsection (d)](#d) is deemed to be a disproportionate share [hospital](/usc/42/300s–3.md?p=1) if— - (A) the [hospital](/usc/42/300s–3.md?p=1)’s medicaid inpatient utilization rate (as defined in [paragraph (2)](#b-2)) is at least one [standard](/usc/42/1320d.md?p=7) deviation above the mean medicaid inpatient utilization rate for [hospitals](/usc/42/300s–3.md?p=1) receiving medicaid payments in the [State](/usc/42/619.md?p=5); or - (B) the [hospital](/usc/42/300s–3.md?p=1)’s low-income utilization rate (as defined in [paragraph (3)](#b-3)) exceeds 25 percent. - (2) For purposes of [paragraph (1)(A)](#b-1-A), the term “medicaid inpatient utilization rate” means, for a [hospital](/usc/42/300s–3.md?p=1), a fraction (expressed as a percentage), the numerator of which is the [hospital](/usc/42/300s–3.md?p=1)’s number of inpatient days attributable to patients who (for such days) were eligible for [medical assistance](/usc/42/1396d.md?p=a) under a [State](/usc/42/619.md?p=5) plan approved under this subchapter in a period (regardless of whether such patients receive [medical assistance](/usc/42/1396d.md?p=a) on a fee-for-service basis or through a managed care entity), and the denominator of which is the total number of the [hospital](/usc/42/300s–3.md?p=1)’s inpatient days in that period. In this paragraph, the term “inpatient day” [includes](/usc/42/1301.md?p=b) each day in which an individual ([including](/usc/42/1301.md?p=b) a newborn) is an inpatient in the [hospital](/usc/42/300s–3.md?p=1), whether or not the individual is in a specialized ward and whether or not the individual remains in the [hospital](/usc/42/300s–3.md?p=1) for lack of suitable placement elsewhere. - (3) For purposes of [paragraph (1)(B)](#b-1-B), the term “low-income utilization rate” means, for a [hospital](/usc/42/300s–3.md?p=1), the sum of— - (A) the fraction (expressed as a percentage)— - (i) the numerator of which is the sum (for a period) of (I) the total revenues paid the [hospital](/usc/42/300s–3.md?p=1) for patient services under a [State](/usc/42/619.md?p=5) plan under this subchapter (regardless of whether the services were furnished on a fee-for-service basis or through a managed care entity) and (II) the amount of the cash subsidies for patient services received directly from [State](/usc/42/619.md?p=5) and local governments, and - (ii) the denominator of which is the total amount of revenues of the [hospital](/usc/42/300s–3.md?p=1) for patient services ([including](/usc/42/1301.md?p=b) the amount of such cash subsidies) in the period; and - (B) a fraction (expressed as a percentage)— - (i) the numerator of which is the total amount of the [hospital](/usc/42/300s–3.md?p=1)’s charges for inpatient [hospital](/usc/42/300s–3.md?p=1) services which are attributable to charity care in a period, less the portion of any cash subsidies described in clause (i)(II) of subparagraph (A) in the period reasonably attributable to inpatient [hospital](/usc/42/300s–3.md?p=1) services, and - (ii) the denominator of which is the total amount of the [hospital](/usc/42/300s–3.md?p=1)’s charges for inpatient [hospital](/usc/42/300s–3.md?p=1) services in the [hospital](/usc/42/300s–3.md?p=1) in the period. The numerator under [subparagraph (B)(i)](#b-3-B-i) shall not include contractual allowances and discounts (other than for indigent patients not eligible for [medical assistance](/usc/42/1396d.md?p=a) under a [State](/usc/42/619.md?p=5) plan approved under this subchapter). - (4) The [Secretary](/usc/42/1301.md?p=a-6) may not restrict a [State](/usc/42/619.md?p=5)’s authority to designate [hospitals](/usc/42/300s–3.md?p=1) as disproportionate share [hospitals](/usc/42/300s–3.md?p=1) under this section. The previous sentence shall not be construed to affect the authority of the [Secretary](/usc/42/1301.md?p=a-6) to reduce payments pursuant to [section 1396b(w)(1)(A)(iii) of this title](/usc/42/1396b.md?p=w-1-A-iii) if the [Secretary](/usc/42/1301.md?p=a-6) determines that, as a result of such designations, there is in effect a hold harmless provision described in [section 1396b(w)(4) of this title](/usc/42/1396b.md?p=w-4). - (c) **Payment adjustment—** Subject to subsections [(f)](#f) and [(g)](#g), in order to be consistent with this subsection, a payment adjustment for a disproportionate share [hospital](/usc/42/300s–3.md?p=1) must either— - (1) be in an amount equal to at least the product of (A) the amount paid under the [State](/usc/42/619.md?p=5) plan to the [hospital](/usc/42/300s–3.md?p=1) for operating costs for inpatient [hospital](/usc/42/300s–3.md?p=1) services (of the kind described in [section 1395ww(a)(4) of this title](/usc/42/1395ww.md?p=a-4)), and (B) the [hospital](/usc/42/300s–3.md?p=1)’s disproportionate share adjustment percentage (established under [section 1395ww(d)(5)(F)(iv) of this title](/usc/42/1395ww.md?p=d-5-F-iv)); - (2) provide for a minimum specified additional payment amount (or increased percentage payment) and (without regard to whether the [hospital](/usc/42/300s–3.md?p=1) is described in subparagraph [(A)](#b-1-A) or [(B)](#b-1-B) of subsection (b)(1)) for an increase in such a payment amount (or percentage payment) in proportion to the percentage by which the [hospital](/usc/42/300s–3.md?p=1)’s medicaid utilization rate (as defined in [subsection (b)(2)](#b-2)) exceeds one [standard](/usc/42/1320d.md?p=7) deviation above the mean medicaid inpatient utilization rate for [hospitals](/usc/42/300s–3.md?p=1) receiving medicaid payments in the [State](/usc/42/619.md?p=5) or the [hospital](/usc/42/300s–3.md?p=1)’s low-income utilization rate (as defined in paragraph[^1] (b)(3)); or - (3) provide for a minimum specified additional payment amount (or increased percentage payment) that varies according to type of [hospital](/usc/42/300s–3.md?p=1) under a methodology that— - (A) applies equally to all [hospitals](/usc/42/300s–3.md?p=1) of each type; and - (B) results in an adjustment for each type of [hospital](/usc/42/300s–3.md?p=1) that is reasonably related to the costs, volume, or proportion of services provided to patients eligible for [medical assistance](/usc/42/1396d.md?p=a) under a [State](/usc/42/619.md?p=5) plan approved under this subchapter or to low-income patients, except that, for purposes of paragraphs [(1)(B)](#a-1-B) and [(2)(A)](#a-2-A) of subsection (a), the payment adjustment for a disproportionate share [hospital](/usc/42/300s–3.md?p=1) is consistent with this subsection if the appropriate increase in the rate or amount of payment is equal to at least one-third of the increase otherwise applicable under this subsection (in the case of such [paragraph (1)(B)](#a-1-B)) and at least two-thirds of such increase (in the case of such [paragraph (2)(A)](#a-2-A)). In the case of a [hospital](/usc/42/300s–3.md?p=1) described in [subsection (d)(2)(A)(i)](#d-2-A-i) (relating to children’s [hospitals](/usc/42/300s–3.md?p=1)), in computing the [hospital](/usc/42/300s–3.md?p=1)’s disproportionate share ad­justment percentage for purposes of paragraph (1)(B) of this subsection, the disproportionate patient percentage (defined in [section 1395ww(d)(5)(F)(vi) of this title](/usc/42/1395ww.md?p=d-5-F-vi)) shall be computed by substituting for the fraction described in [subclause (I)](/usc/42/1395ww.md?p=d-5-F-vi-I) of such section the fraction described in [subclause (II)](/usc/42/1395ww.md?p=d-5-F-vi-II) of that section. If a [State](/usc/42/619.md?p=5) elects in a [State](/usc/42/619.md?p=5) plan amendment under [subsection (a)](#a) to provide the payment adjustment described in [paragraph (2)](#c-2), the [State](/usc/42/619.md?p=5) must include in the amendment a detailed description of the specific methodology to be used in determining the specified additional payment amount (or increased percentage payment) to be made to each [hospital](/usc/42/300s–3.md?p=1) qualifying for such a payment adjustment and must publish at least annually the name of each [hospital](/usc/42/300s–3.md?p=1) qualifying for such a payment adjustment and the amount of such payment adjustment made for each such [hospital](/usc/42/300s–3.md?p=1). - (d) **Requirements to qualify as disproportionate share hospital—** - (1) Except as provided in [paragraph (2)](#d-2), no [hospital](/usc/42/300s–3.md?p=1) may be defined or deemed as a disproportionate share [hospital](/usc/42/300s–3.md?p=1) under a [State](/usc/42/619.md?p=5) plan under this subchapter or under [subsection (b)](#b) of this section unless the [hospital](/usc/42/300s–3.md?p=1) has at least 2 obstetricians who have staff privileges at the [hospital](/usc/42/300s–3.md?p=1) and who have agreed to provide obstetric services to individuals who are entitled to [medical assistance](/usc/42/1396d.md?p=a) for such services under such [State](/usc/42/619.md?p=5) plan. - (2) - (A) [Paragraph (1)](#d-1) shall not apply to a [hospital](/usc/42/300s–3.md?p=1)— - (i) the inpatients of which are predominantly individuals under 18 years of age; or - (ii) which does not offer nonemergency obstetric services to the general population as of December 22, 1987. - (B) In the case of a [hospital](/usc/42/300s–3.md?p=1) located in a rural area (as defined for purposes of [section 1395ww of this title](/usc/42/1395ww.md)), in [paragraph (1)](#d-1) the term “obstetrician” [includes](/usc/42/1301.md?p=b) any [physician](/usc/42/1301.md?p=a-7) with staff privileges at the [hospital](/usc/42/300s–3.md?p=1) to perform nonemergency obstetric procedures. - (3) No [hospital](/usc/42/300s–3.md?p=1) may be defined or deemed as a disproportionate share [hospital](/usc/42/300s–3.md?p=1) under a [State](/usc/42/619.md?p=5) plan under this subchapter or under subsection [(b)](#b) or [(e)](#e) of this section unless the [hospital](/usc/42/300s–3.md?p=1) has a medicaid inpatient utilization rate (as defined in [subsection (b)(2)](#b-2)) of not less than 1 percent. - (e) **Special rule—** - (1) A [State](/usc/42/619.md?p=5) plan shall be considered to meet the requirement of [section 1396a(a)(13)(A)(iv) of this title](/usc/42/1396a.md?p=a-13-A-iv) (insofar as it requires payments to [hospitals](/usc/42/300s–3.md?p=1) to take into account the situation of [hospitals](/usc/42/300s–3.md?p=1) which serve a disproportionate number of [low income](/usc/42/701.md?p=b-2) patients with special needs) without regard to the requirement of [subsection (a)](#a) if (A)(i) the plan provided for payment adjustments based on a pooling arrangement involving a majority of the [hospitals](/usc/42/300s–3.md?p=1) participating under the plan for disproportionate share [hospitals](/usc/42/300s–3.md?p=1) as of January 1, 1984, or (ii) the plan as of January 1, 1987, provided for payment adjustments based on a statewide pooling arrangement involving all acute care [hospitals](/usc/42/300s–3.md?p=1) and the arrangement provides for reimbursement of the total amount of uncompensated care provided by each participating [hospital](/usc/42/300s–3.md?p=1), (B) the aggregate amount of the payment adjustments under the plan for such [hospitals](/usc/42/300s–3.md?p=1) is not less than the aggregate amount of such adjustments otherwise required to be made under such subsection, and (C) the plan meets the requirement of [subsection (d)(3)](#d-3) and such payment adjustments are made consistent with the last sentence of [subsection (c)](#c). - (2) In the case of a [State](/usc/42/619.md?p=5) that used a health insuring organization before January 1, 1986, to administer a portion of its plan on a statewide basis, beginning on July 1, 1988— - (A) the requirements of subsections [(b)](#b) and [(c)](#c) (other than the last sentence of [subsection (c)](#c)) shall not apply if the aggregate amount of the payment adjustments under the plan for disproportionate share [hospitals](/usc/42/300s–3.md?p=1) (as defined under the [State](/usc/42/619.md?p=5) plan) is not less than the aggregate amount of payment adjustments otherwise required to be made if such subsections applied, - (B) [subsection (d)(2)(B)](#d-2-B) shall apply to [hospitals](/usc/42/300s–3.md?p=1) located in urban areas, as well as in rural areas, - (C) [subsection (d)(3)](#d-3) shall apply, and - (D) [subsection (g)](#g) shall apply. - (f) **Limitation on Federal financial participation—** - (1) **In general—** Payment under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) shall not be made to a [State](/usc/42/619.md?p=5) with respect to any payment adjustment made under this section for [hospitals](/usc/42/300s–3.md?p=1) in a [State](/usc/42/619.md?p=5) for quarters in a [fiscal year](/usc/42/619.md?p=3) in excess of the disproportionate share [hospital](/usc/42/300s–3.md?p=1) (in this subsection referred to as “DSH”) allotment for the [State](/usc/42/619.md?p=5) for the [fiscal year](/usc/42/619.md?p=3), as specified in paragraphs [(2)](#f-2), [(3)](#f-3), and [(7)](#f-7). - (2) **State DSH allotments for fiscal years 1998 through 2002—** Subject to [paragraph (4)](#f-4), the DSH allotment for a [State](/usc/42/619.md?p=5) for each [fiscal year](/usc/42/619.md?p=3) during the period beginning with [fiscal year](/usc/42/619.md?p=3) 1998 and ending with [fiscal year](/usc/42/619.md?p=3) 2002 is determined in accordance with the following table: | [State](/usc/42/619.md?p=5) or District | DSH Allotment (in millions of dollars) | | | | | | --- | --- | --- | --- | --- | --- | | FY 98 | FY 99 | FY 00 | FY 01 | FY 02 | | | Alabama | 293 | 269 | 248 | 246 | 246 | | Alaska | 10 | 10 | 10 | 9 | 9 | | Arizona | 81 | 81 | 81 | 81 | 81 | | Arkansas | 2 | 2 | 2 | 2 | 2 | | California | 1,085 | 1,068 | 986 | 931 | 877 | | Colorado | 93 | 85 | 79 | 74 | 74 | | Connecticut | 200 | 194 | 164 | 160 | 160 | | Delaware | 4 | 4 | 4 | 4 | 4 | | District of Columbia | 23 | 23 | 49 | 49 | 49 | | Florida | 207 | 203 | 197 | 188 | 160 | | Georgia | 253 | 248 | 241 | 228 | 215 | | Hawaii | 0 | 0 | 0 | 0 | 0 | | Idaho | 1 | 1 | 1 | 1 | 1 | | Illinois | 203 | 199 | 193 | 182 | 172 | | Indiana | 201 | 197 | 191 | 181 | 171 | | Iowa | 8 | 8 | 8 | 8 | 8 | | Kansas | 51 | 49 | 42 | 36 | 33 | | Kentucky | 137 | 134 | 130 | 123 | 116 | | Louisiana | 880 | 795 | 713 | 658 | 631 | | Maine | 103 | 99 | 84 | 84 | 84 | | Maryland | 72 | 70 | 68 | 64 | 61 | | Massachusetts | 288 | 282 | 273 | 259 | 244 | | Michigan | 249 | 244 | 237 | 224 | 212 | | Minnesota | 16 | 16 | 33 | 33 | 33 | | Mississippi | 143 | 141 | 136 | 129 | 122 | | Missouri | 436 | 423 | 379 | 379 | 379 | | Montana | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | | Nebraska | 5 | 5 | 5 | 5 | 5 | | Nevada | 37 | 37 | 37 | 37 | 37 | | New Hampshire | 140 | 136 | 130 | 130 | 130 | | New Jersey | 600 | 582 | 515 | 515 | 515 | | New Mexico | 5 | 5 | 9 | 9 | 9 | | New York | 1,512 | 1,482 | 1,436 | 1,361 | 1,285 | | North Carolina | 278 | 272 | 264 | 250 | 236 | | North Dakota | 1 | 1 | 1 | 1 | 1 | | Ohio | 382 | 374 | 363 | 344 | 325 | | Oklahoma | 16 | 16 | 16 | 16 | 16 | | Oregon | 20 | 20 | 20 | 20 | 20 | | Pennsylvania | 529 | 518 | 502 | 476 | 449 | | Rhode Island | 62 | 60 | 58 | 55 | 52 | | South Carolina | 313 | 303 | 262 | 262 | 262 | | South Dakota | 1 | 1 | 1 | 1 | 1 | | Tennessee | 0 | 0 | 0 | 0 | 0 | | Texas | 979 | 950 | 806 | 765 | 765 | | Utah | 3 | 3 | 3 | 3 | 3 | | Vermont | 18 | 18 | 18 | 18 | 18 | | Virginia | 70 | 68 | 66 | 63 | 59 | | Washington | 174 | 171 | 166 | 157 | 148 | | West Virginia | 64 | 63 | 61 | 58 | 54 | | Wisconsin | 7 | 7 | 7 | 7 | 7 | | Wyoming | 0 | 0 | 0.1 | 0.1 | 0.1. | - (3) **State DSH allotments for fiscal year 2003 and thereafter—** - (A) **In general—** Except as provided in paragraphs [(6)](#f-6), [(7)](#f-7), and [(8)](#f-8) and subparagraphs [(E)](#f-3-E) and [(F)](#f-3-F), the DSH allotment for any [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2003 and each succeeding [fiscal year](/usc/42/619.md?p=3) is equal to the DSH allotment for the [State](/usc/42/619.md?p=5) for the preceding [fiscal year](/usc/42/619.md?p=3) under [paragraph (2)](#f-2) or this paragraph, increased, subject to subparagraphs [(B)](#f-3-B) and [(C)](#f-3-C) and [paragraph (5)](#f-5), by the percentage change in the consumer price index for all urban consumers (all items; U.S. city average), for the previous [fiscal year](/usc/42/619.md?p=3). - (B) **Limitation—** The DSH allotment for a [State](/usc/42/619.md?p=5) shall not be increased under [subparagraph (A)](#f-3-A) for a [fiscal year](/usc/42/619.md?p=3) to the extent that such an increase would result in the DSH allotment for the year exceeding the greater of— - (i) the DSH allotment for the previous year, or - (ii) 12 percent of the total amount of expenditures under the [State](/usc/42/619.md?p=5) plan for [medical assistance](/usc/42/1396d.md?p=a) during the [fiscal year](/usc/42/619.md?p=3). - (C) **Special, temporary increase in allotments on a one-time, non-cumulative basis—** The DSH allotment for any [State](/usc/42/619.md?p=5) (other than a [State](/usc/42/619.md?p=5) with a DSH allotment determined under [paragraph (5)](#f-5))— - (i) for [fiscal year](/usc/42/619.md?p=3) 2004 is equal to 116 percent of the DSH allotment for the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2003 under this paragraph, notwithstanding [subparagraph (B)](#f-3-B); and - (ii) for each succeeding [fiscal year](/usc/42/619.md?p=3) is equal to the DSH allotment for the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2004 or, in the case of [fiscal years](/usc/42/619.md?p=3) beginning with the [fiscal year](/usc/42/619.md?p=3) specified in [subparagraph (D)](#f-3-D) for that [State](/usc/42/619.md?p=5), the DSH allotment for the [State](/usc/42/619.md?p=5) for the previous [fiscal year](/usc/42/619.md?p=3) increased by the percentage change in the consumer price index for all urban consumers (all items; U.S. city average), for the previous [fiscal year](/usc/42/619.md?p=3). - (D) **Fiscal year specified—** For purposes of [subparagraph (C)(ii)](#f-3-C-ii), the [fiscal year](/usc/42/619.md?p=3) specified in this subparagraph for a [State](/usc/42/619.md?p=5) is the first [fiscal year](/usc/42/619.md?p=3) for which the [Secretary](/usc/42/1301.md?p=a-6) estimates that the DSH allotment for that [State](/usc/42/619.md?p=5) will equal (or no longer exceed) the DSH allotment for that [State](/usc/42/619.md?p=5) under the law as in effect before December 8, 2003. - (E) **Temporary increase in allotments during recession—** - (i) **In general—** Subject to [clause (ii)](#f-3-E-ii), the DSH allotment for any [State](/usc/42/619.md?p=5)— - (I) for [fiscal year](/usc/42/619.md?p=3) 2009 is equal to 102.5 percent of the DSH allotment that would be determined under this paragraph for the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2009 without application of this subparagraph, notwithstanding subparagraphs [(B)](#f-3-B) and [(C)](#f-3-C); - (II) for [fiscal year](/usc/42/619.md?p=3) 2010 is equal to 102.5 percent of the DSH allotment for the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2009, as determined under [subclause (I)](#f-3-E-i-I); and - (III) for each succeeding [fiscal year](/usc/42/619.md?p=3) is equal to the DSH allotment for the [State](/usc/42/619.md?p=5) under this paragraph determined without applying subclauses [(I)](#f-3-E-i-I) and [(II)](#f-3-E-i-II). - (ii) **Application—** [Clause (i)](#f-3-E-i) shall not apply to a [State](/usc/42/619.md?p=5) for a year in the case that the DSH allotment for such [State](/usc/42/619.md?p=5) for such year under this paragraph determined without applying [clause (i)](#f-3-E-i) would grow higher than the DSH allotment specified under [clause (i)](#f-3-E-i) for the [State](/usc/42/619.md?p=5) for such year. - (F) **Allotments during the coronavirus temporary medicaid FMAP increase—** - (i) **In general—** Notwithstanding any other provision of this subsection, for any [fiscal year](/usc/42/619.md?p=3) for which the [Federal medical assistance percentage](/usc/42/1396d.md?p=b) applicable to expenditures under this section is increased pursuant to section 6008 of the Families First Coronavirus Response Act, the [Secretary](/usc/42/1301.md?p=a-6) shall recalculate the annual DSH allotment, [including](/usc/42/1301.md?p=b) the DSH allotment specified under [paragraph (6)(A)(vi)](#f-6-A-vi), to ensure that the total DSH payments ([including](/usc/42/1301.md?p=b) both Federal and [State](/usc/42/619.md?p=5) shares) that a [State](/usc/42/619.md?p=5) may make related to a [fiscal year](/usc/42/619.md?p=3) is equal to the total DSH payments that the [State](/usc/42/619.md?p=5) could have made for such [fiscal year](/usc/42/619.md?p=3) without such increase to the [Federal medical assistance percentage](/usc/42/1396d.md?p=b). - (ii) **No application to allotments beginning after COVID–19 emergency period—** The DSH allotment for any [State](/usc/42/619.md?p=5) for the first [fiscal year](/usc/42/619.md?p=3) beginning after the end of the emergency period described in [section 1320b–5(g)(1)(B) of this title](/usc/42/1320b–5.md?p=g-1-B) or any succeeding [fiscal year](/usc/42/619.md?p=3) shall be determined under this paragraph without regard to the DSH allotments determined under [clause (i)](#f-3-F-i). - (4) **Special rule for fiscal years 2001 and 2002—** - (A) **In general—** Notwithstanding [paragraph (2)](#f-2), the DSH allotment for any [State](/usc/42/619.md?p=5) for— - (i) [fiscal year](/usc/42/619.md?p=3) 2001, shall be the DSH allotment determined under [paragraph (2)](#f-2) for [fiscal year](/usc/42/619.md?p=3) 2000 increased, subject to [subparagraph (B)](#f-4-B) and [paragraph (5)](#f-5), by the percentage change in the consumer price index for all urban consumers (all items; U.S. city average) for [fiscal year](/usc/42/619.md?p=3) 2000; and - (ii) [fiscal year](/usc/42/619.md?p=3) 2002, shall be the DSH allotment determined under [clause (i)](#f-4-A-i) increased, subject to [subparagraph (B)](#f-4-B) and [paragraph (5)](#f-5), by the percentage change in the consumer price index for all urban consumers (all items; U.S. city average) for [fiscal year](/usc/42/619.md?p=3) 2001. - (B) **Limitation—** [Subparagraph (B)](#f-3-B) of paragraph (3) shall apply to subparagraph (A) of this paragraph in the same manner as that [subparagraph (B)](#f-4-B) applies to [paragraph (3)(A)](#f-3-A). - (C) **No application to allotments after fiscal year 2002—** The DSH allotment for any [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2003 or any succeeding [fiscal year](/usc/42/619.md?p=3) shall be determined under [paragraph (3)](#f-3) without regard to the DSH allotments determined under subparagraph (A) of this paragraph. - (5) **Special rule for low DSH States—** - (A) **For fiscal years 2001 through 2003 for extremely low DSH States—** In the case of a [State](/usc/42/619.md?p=5) in which the total expenditures under the [State](/usc/42/619.md?p=5) plan ([including](/usc/42/1301.md?p=b) Federal and [State](/usc/42/619.md?p=5) shares) for disproportionate share [hospital](/usc/42/300s–3.md?p=1) adjustments under this section for [fiscal year](/usc/42/619.md?p=3) 1999, as reported to the [Administrator](/usc/42/4005.md?p=1) of the Health Care Financing [Administration](/usc/42/1301.md?p=a-10) as of August 31, 2000, is greater than 0 but less than 1 percent of the [State](/usc/42/619.md?p=5)’s total amount of expenditures under the [State](/usc/42/619.md?p=5) plan for [medical assistance](/usc/42/1396d.md?p=a) during the [fiscal year](/usc/42/619.md?p=3), the DSH allotment for [fiscal year](/usc/42/619.md?p=3) 2001 shall be increased to 1 percent of the [State](/usc/42/619.md?p=5)’s total amount of expenditures under such plan for such assistance during such [fiscal year](/usc/42/619.md?p=3). In subsequent [fiscal years](/usc/42/619.md?p=3) before [fiscal year](/usc/42/619.md?p=3) 2004, such increased allotment is subject to an increase for inflation as provided in [paragraph (3)(A)](#f-3-A). - (B) **For fiscal year 2004 and subsequent fiscal years—** In the case of a [State](/usc/42/619.md?p=5) in which the total expenditures under the [State](/usc/42/619.md?p=5) plan ([including](/usc/42/1301.md?p=b) Federal and [State](/usc/42/619.md?p=5) shares) for disproportionate share [hospital](/usc/42/300s–3.md?p=1) adjustments under this section for [fiscal year](/usc/42/619.md?p=3) 2000, as reported to the [Administrator](/usc/42/4005.md?p=1) of the Centers for Medicare & Medicaid Services as of August 31, 2003, is greater than 0 but less than 3 percent of the [State](/usc/42/619.md?p=5)’s total amount of expenditures under the [State](/usc/42/619.md?p=5) plan for [medical assistance](/usc/42/1396d.md?p=a) during the [fiscal year](/usc/42/619.md?p=3), the DSH allotment for the [State](/usc/42/619.md?p=5) with respect to— - (i) [fiscal year](/usc/42/619.md?p=3) 2004 shall be the DSH allotment for the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2003 increased by 16 percent; - (ii) each succeeding [fiscal year](/usc/42/619.md?p=3) before [fiscal year](/usc/42/619.md?p=3) 2009 shall be the DSH allotment for the [State](/usc/42/619.md?p=5) for the previous [fiscal year](/usc/42/619.md?p=3) increased by 16 percent; and - (iii) [fiscal year](/usc/42/619.md?p=3) 2009 and any subsequent [fiscal year](/usc/42/619.md?p=3), shall be the DSH allotment for the [State](/usc/42/619.md?p=5) for the previous year subject to an increase for inflation as provided in [paragraph (3)(A)](#f-3-A). - (6) **Allotment adjustments—** - (A) **Tennessee—** - (i) **In general—** Only with respect to [fiscal year](/usc/42/619.md?p=3) 2007, the DSH allotment for Tennessee for such [fiscal year](/usc/42/619.md?p=3), notwithstanding the table set forth in [paragraph (2)](#f-2) or the terms of the TennCare Demonstration [Project](/usc/42/13641.md?p=2) in effect for the [State](/usc/42/619.md?p=5), shall be the greater of— - (I) the amount that the [Secretary](/usc/42/1301.md?p=a-6) determines is equal to the [Federal medical assistance percentage](/usc/42/1396d.md?p=b) component attributable to disproportionate share [hospital](/usc/42/300s–3.md?p=1) payment adjustments for the demonstration year ending in 2006 that is reflected in the budget neutrality provision of the TennCare Demonstration [Project](/usc/42/13641.md?p=2); and - (II) $280,000,000. Only with respect to [fiscal years](/usc/42/619.md?p=3) 2008, 2009, 2010, and 2011, the DSH allotment for Tennessee for the [fiscal year](/usc/42/619.md?p=3), notwithstanding such table or terms, shall be the amount specified in the previous sentence for [fiscal year](/usc/42/619.md?p=3) 2007. Only with respect to [fiscal year](/usc/42/619.md?p=3) 2012 for the period ending on December 31, 2011, the DSH allotment for Tennessee for such portion of the [fiscal year](/usc/42/619.md?p=3), notwithstanding such table or terms, shall be ¼ of the amount specified in the first sentence for [fiscal year](/usc/42/619.md?p=3) 2007. - (ii) **Limitation on amount of payment adjustments eligible for Federal financial participation—** Payment under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) shall not be made to Tennessee with respect to the aggregate amount of any payment adjustments made under this section for [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2007, 2008, 2009, 2010, 2011, or for period[^2] in [fiscal year](/usc/42/619.md?p=3) 2012 described in [clause (i)](#f-6-A-i) that is in excess of 30 percent of the DSH allotment for the [State](/usc/42/619.md?p=5) for such [fiscal year](/usc/42/619.md?p=3) or period determined pursuant to [clause (i)](#f-6-A-i). - (iii) **State plan amendment—** The [Secretary](/usc/42/1301.md?p=a-6) shall permit Tennessee to submit an amendment to its [State](/usc/42/619.md?p=5) plan under this subchapter that describes the methodology to be used by the [State](/usc/42/619.md?p=5) to identify and make payments to disproportionate share [hospitals](/usc/42/300s–3.md?p=1), [including](/usc/42/1301.md?p=b) children’s [hospitals](/usc/42/300s–3.md?p=1) and institutions for mental diseases or other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B). The [Secretary](/usc/42/1301.md?p=a-6) may not approve such plan amendment unless the methodology described in the amendment is consistent with the requirements under this section for making payment adjustments to disproportionate share [hospitals](/usc/42/300s–3.md?p=1). For purposes of demonstrating budget neutrality under the TennCare Demonstration [Project](/usc/42/13641.md?p=2), payment adjustments made pursuant to a [State](/usc/42/619.md?p=5) plan amendment approved in accordance with this subparagraph shall be considered expenditures under such [project](/usc/42/13641.md?p=2). - (iv) **Offset of Federal share of payment adjustments for fiscal years 2007 through 2011 and the first calendar quarter of fiscal year 2012 against Essential Access Hospital supplemental pool payments under the TennCare Demonstration Project—** - (I) The total amount of Essential Access [Hospital](/usc/42/300s–3.md?p=1) supplemental pool payments that may be made under the TennCare Demonstration [Project](/usc/42/13641.md?p=2) for [fiscal year](/usc/42/619.md?p=3) 2007, 2008, 2009, 2010, 2011, or for a period in [fiscal year](/usc/42/619.md?p=3) 2012 described in [clause (i)](#f-6-A-i) shall be reduced on a dollar for dollar basis by the amount of any payments made under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) to Tennessee with respect to payment adjustments made under this section for [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) for such [fiscal year](/usc/42/619.md?p=3) or period. - (II) The sum of the total amount of payments made under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) to Tennessee with respect to payment adjustments made under this section for [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) for [fiscal year](/usc/42/619.md?p=3) 2007, 2008, 2009, 2010, 2011, or for a period in [fiscal year](/usc/42/619.md?p=3) 2012 described in [clause (i)](#f-6-A-i) and the total amount of Essential Access [Hospital](/usc/42/300s–3.md?p=1) supplemental pool payments made under the TennCare Demonstration [Project](/usc/42/13641.md?p=2) for such [fiscal year](/usc/42/619.md?p=3) or period shall not exceed the [State](/usc/42/619.md?p=5)’s DSH allotment for such [fiscal year](/usc/42/619.md?p=3) or period established under [clause (i)](#f-6-A-i). - (v) **Allotment for 2d, 3rd, and 4th quarters of fiscal year 2012 and for fiscal year 2013—** Notwithstanding the table set forth in [paragraph (2)](#f-2): - (I) **2d, 3rd, and 4th quarters of fiscal year 2012—** In the case of a [State](/usc/42/619.md?p=5) that has a DSH allotment of $0 for the 2d, 3rd, and 4th quarters of [fiscal year](/usc/42/619.md?p=3) 2012, the DSH allotment shall be $47,200,000 for such quarters. - (II) **Fiscal year 2013—** In the case of a [State](/usc/42/619.md?p=5) that has a DSH allotment of $0 for [fiscal year](/usc/42/619.md?p=3) 2013, the DSH allotment shall be $53,100,000 for such [fiscal year](/usc/42/619.md?p=3). - (vi) **Allotment for fiscal years 2015 through 2027—** Notwithstanding any other provision of this subsection, any other provision of law, or the terms of the TennCare Demonstration [Project](/usc/42/13641.md?p=2) in effect for the [State](/usc/42/619.md?p=5), the DSH allotment for Tennessee for [fiscal year](/usc/42/619.md?p=3) 2015, and for each [fiscal year](/usc/42/619.md?p=3) thereafter through [fiscal year](/usc/42/619.md?p=3) 2025, shall be $53,100,000 for each such [fiscal year](/usc/42/619.md?p=3), and the DSH allotment for Tennessee for the portion of [fiscal year](/usc/42/619.md?p=3) 2026 beginning October 1, 2025, and ending January 30, 2026, shall be $17,748,493, which may be claimed as [fiscal year](/usc/42/619.md?p=3) 2026 uncompensated care costs, and the DSH allotment for Tennessee for the portion of [fiscal year](/usc/42/619.md?p=3) 2026 beginning on January 31, 2026, and ending September 30, 2026, shall be $35,351,507, which may be claimed as [fiscal year](/usc/42/619.md?p=3) 2026 uncompensated care costs, and the DSH allotment for Tennessee for [fiscal year](/usc/42/619.md?p=3) 2027, shall be $53,100,000. - (B) **Hawaii—** - (i) **In general—** Only with respect to each of [fiscal years](/usc/42/619.md?p=3) 2007 through 2011, the DSH allotment for Hawaii for such [fiscal year](/usc/42/619.md?p=3), notwithstanding the table set forth in [paragraph (2)](#f-2), shall be $10,000,000. Only with respect to [fiscal year](/usc/42/619.md?p=3) 2012 for the period ending on December 31, 2011, the DSH allotment for Hawaii for such portion of the [fiscal year](/usc/42/619.md?p=3), notwithstanding the table set forth in [paragraph (2)](#f-2), shall be $2,500,000. - (ii) **State plan amendment—** The [Secretary](/usc/42/1301.md?p=a-6) shall permit Hawaii to submit an amendment to its [State](/usc/42/619.md?p=5) plan under this subchapter that describes the methodology to be used by the [State](/usc/42/619.md?p=5) to identify and make payments to disproportionate share [hospitals](/usc/42/300s–3.md?p=1), [including](/usc/42/1301.md?p=b) children’s [hospitals](/usc/42/300s–3.md?p=1) and institutions for mental diseases or other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B). The [Secretary](/usc/42/1301.md?p=a-6) may not approve such plan amendment unless the methodology described in the amendment is consistent with the requirements under this section for making payment adjustments to disproportionate share [hospitals](/usc/42/300s–3.md?p=1). - (iii) **Allotment for 2d, 3rd, and 4th quarter of fiscal year 2012, fiscal year 2013, and succeeding fiscal years—** Notwithstanding the table set forth in [paragraph (2)](#f-2): - (I) **2d, 3rd, and 4th quarter of fiscal year 2012—** The DSH allotment for Hawaii for the 2d, 3rd, and 4th quarters of [fiscal year](/usc/42/619.md?p=3) 2012 shall be $7,500,000. - (II) **Treatment as a low-DSH State for fiscal year 2013 and succeeding fiscal years—** With respect to [fiscal year](/usc/42/619.md?p=3) 2013, and each [fiscal year](/usc/42/619.md?p=3) thereafter, the DSH allotment for Hawaii shall be increased in the same manner as allotments for low DSH [States](/usc/42/619.md?p=5) are increased for such [fiscal year](/usc/42/619.md?p=3) under [clause (iii)](#f-5-B-iii) of paragraph (5)(B). - (III) **Certain hospital payments—** The [Secretary](/usc/42/1301.md?p=a-6) may not impose a limitation on the total amount of payments made to [hospitals](/usc/42/300s–3.md?p=1) under the QUEST section 1115 Demonstration [Project](/usc/42/13641.md?p=2) except to the extent that such limitation is necessary to ensure that a [hospital](/usc/42/300s–3.md?p=1) does not receive payments in excess of the amounts described in [subsection (g)](#g), or as necessary to ensure that such payments under the waiver and such payments pursuant to the allotment provided in this clause do not, in the aggregate in any year, exceed the amount that the [Secretary](/usc/42/1301.md?p=a-6) determines is equal to the [Federal medical assistance percentage](/usc/42/1396d.md?p=b) component attributable to disproportionate share [hospital](/usc/42/300s–3.md?p=1) payment adjustments for such year that is reflected in the budget neutrality provision of the QUEST Demonstration [Project](/usc/42/13641.md?p=2). - (7) **Medicaid DSH reductions—** - (A) **Reductions—** - (i) **In general—** For [fiscal year](/usc/42/619.md?p=3) 2028, the [Secretary](/usc/42/1301.md?p=a-6) shall effect the following reductions: - (I) **Reduction in DSH allotments—** The [Secretary](/usc/42/1301.md?p=a-6) shall reduce DSH allotments to [States](/usc/42/619.md?p=5) in the amount specified under the DSH health reform methodology under [subparagraph (B)](#f-7-B) for the [State](/usc/42/619.md?p=5) for the [fiscal year](/usc/42/619.md?p=3). - (II) **Reductions in payments—** The [Secretary](/usc/42/1301.md?p=a-6) shall reduce payments to [States](/usc/42/619.md?p=5) under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) for each calendar quarter in the [fiscal year](/usc/42/619.md?p=3), in the manner specified in [clause (iii)](#f-7-A-iii), in an amount equal to ¼ of the DSH allotment reduction under [subclause (I)](#f-7-A-i-I) for the [State](/usc/42/619.md?p=5) for the [fiscal year](/usc/42/619.md?p=3). - (ii) **Aggregate reductions—** The aggregate reductions in DSH allotments for all [States](/usc/42/619.md?p=5) under [clause (i)(I)](#f-7-A-i-I) shall be equal to $8,000,000,000 for [fiscal year](/usc/42/619.md?p=3) 2028. - (iii) **Manner of payment reduction—** The amount of the payment reduction under [clause (i)(II)](#f-7-A-i-II) for a [State](/usc/42/619.md?p=5) for a quarter shall be deemed an overpayment to the [State](/usc/42/619.md?p=5) under this subchapter to be disallowed against the [State](/usc/42/619.md?p=5)’s regular quarterly draw for all spending under [section 1396b(d)(2) of this title](/usc/42/1396b.md?p=d-2). Such a disallowance is not subject to a reconsideration under subsections (d) and (e) of [section 1316 of this title](/usc/42/1316.md). - (iv) **Definition—** In this paragraph, the term “[State](/usc/42/619.md?p=5)” means the 50 [States](/usc/42/619.md?p=5) and the District of Columbia. - (v) **Distribution of aggregate reductions—** The [Secretary](/usc/42/1301.md?p=a-6) shall distribute the aggregate reductions under [clause (ii)](#f-7-A-ii) among [States](/usc/42/619.md?p=5) in accordance with [subparagraph (B)](#f-7-B). - (B) **DSH Health Reform methodology—** The [Secretary](/usc/42/1301.md?p=a-6) shall carry out [subparagraph (A)](#f-7-A) through use of a DSH Health Reform methodology that meets the following requirements: - (i) The methodology imposes the largest percentage reductions on the [States](/usc/42/619.md?p=5) that— - (I) have the lowest percentages of uninsured individuals (determined on the basis of data from the Bureau of the Census, audited [hospital](/usc/42/300s–3.md?p=1) cost reports, and other information likely to yield accurate data) during the most recent year for which such data are available; or - (II) do not target their DSH payments on— - (aa) [hospitals](/usc/42/300s–3.md?p=1) with high volumes of Medicaid inpatients (as defined in [subsection (b)(1)(A)](#b-1-A)); and - (bb) [hospitals](/usc/42/300s–3.md?p=1) that have high levels of uncompensated care (excluding bad debt). - (ii) The methodology imposes a smaller percentage reduction on low DSH [States](/usc/42/619.md?p=5) described in [paragraph (5)(B)](#f-5-B). - (iii) The methodology takes into account the extent to which the DSH allotment for a [State](/usc/42/619.md?p=5) was included in the budget neutrality calculation for a coverage expansion approved under [section 1315 of this title](/usc/42/1315.md) as of July 31, 2009. - (8) **Calculation of DSH allotments after reductions period—** The DSH allotment for a [State](/usc/42/619.md?p=5) for [fiscal years](/usc/42/619.md?p=3) after [fiscal year](/usc/42/619.md?p=3) 2028 shall be calculated under [paragraph (3)](#f-3) without regard to [paragraph (7)](#f-7). - (9) **“State” defined—** In this subsection, the term “[State](/usc/42/619.md?p=5)” means the 50 [States](/usc/42/619.md?p=5) and the District of Columbia. - (g) **Limit on amount of payment to hospital—** - (1) **In general—** - (A) **Amount of adjustment subject to uncompensated costs—** A payment adjustment during a [fiscal year](/usc/42/619.md?p=3) shall not be considered to be consistent with [subsection (c)](#c) with respect to a [hospital](/usc/42/300s–3.md?p=1) if the payment adjustment exceeds an amount equal to— - (i) the costs incurred during the year of furnishing [hospital](/usc/42/300s–3.md?p=1) services by the [hospital](/usc/42/300s–3.md?p=1) to individuals described in [subparagraph (B)](#g-1-B) with respect to such [hospital](/usc/42/300s–3.md?p=1) and year minus— - (ii) the sum of— - (I) payments under this subchapter (other than under this section) for such services; - (II) payments by uninsured patients for such services; and - (III) payments made under subchapter XVIII or by an applicable plan (as defined in [section 1395y(b)(8)(F) of this title](/usc/42/1395y.md?p=b-8-F)) for such services. - (B) **Individuals described—** For purposes of [subparagraph (A)](#g-1-A), the individuals described in this subparagraph are, with respect to a [hospital](/usc/42/300s–3.md?p=1) and a year, the following: - (i) Individuals who are eligible for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan or under a waiver of such plan and for whom the [State](/usc/42/619.md?p=5) plan or waiver is the primary payor for such services. - (ii) Subject to [subparagraph (C)](#g-1-C), individuals who have no health insurance (or other source of third party coverage) for services provided during the year, as determined by the [Secretary](/usc/42/1301.md?p=a-6). - (iii) Individuals who are eligible for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan or under a waiver of such plan and for whom the [State](/usc/42/619.md?p=5) plan or waiver is a payor for such services after application of benefits under subchapter XVIII or under an applicable plan (as defined in [section 1395y(b)(8)(F) of this title](/usc/42/1395y.md?p=b-8-F)), but only if the [hospital](/usc/42/300s–3.md?p=1) has in the aggregate incurred costs exceeding payments under such [State](/usc/42/619.md?p=5) plan, waiver, subchapter XVIII, or applicable plan for such services furnished to such individuals during such year. - (C) **Exclusion of certain payments—** For purposes of [subparagraph (B)(ii)](#g-1-B-ii), payments made to a [hospital](/usc/42/300s–3.md?p=1) for services provided to indigent patients made by a [State](/usc/42/619.md?p=5) or a unit of local government within a [State](/usc/42/619.md?p=5) shall not be considered to be a source of third party coverage. - (2) **Continued application of grandfathered transition rule—** Paragraph (2) of this subsection (as in effect on September 30, 2021, and as applied under section 4721(e) of the Balanced Budget Act of 1997, and amended by [section 607](/usc/42/607.md) of the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (Public Law 106–113)) shall apply in determining whether a payment adjustment for a [hospital](/usc/42/300s–3.md?p=1) in a [State](/usc/42/619.md?p=5) referenced in section 4721(e) of the Balanced Budget Act of 1997 during a [State](/usc/42/619.md?p=5) [fiscal year](/usc/42/619.md?p=3) shall be considered consistent with [subsection (c)](#c). - (h) **Limitation on certain State DSH expenditures—** - (1) **In general—** Payment under [section 1396b(a) of this title](/usc/42/1396b.md?p=a) shall not be made to a [State](/usc/42/619.md?p=5) with respect to any payment adjustments made under this section for quarters in a [fiscal year](/usc/42/619.md?p=3) (beginning with [fiscal year](/usc/42/619.md?p=3) 1998) to institutions for mental diseases or other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B), to the extent the aggregate of such adjustments in the [fiscal year](/usc/42/619.md?p=3) exceeds the lesser of the following: - (A) **1995 IMD DSH payment adjustments—** The total [State](/usc/42/619.md?p=5) DSH expenditures that are attributable to [fiscal year](/usc/42/619.md?p=3) 1995 for payments to institutions for mental diseases and other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B) (based on reporting data specified by the [State](/usc/42/619.md?p=5) on HCFA Form 64 as mental health DSH, and as approved by the [Secretary](/usc/42/1301.md?p=a-6)). - (B) **Applicable percentage of 1995 total DSH payment allotment—** The amount of such payment adjustments which are equal to the applicable percentage of the Federal share of payment adjustments made to [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) under [subsection (c)](#c) that are attributable to the 1995 DSH allotment for the [State](/usc/42/619.md?p=5) for payments to institutions for mental diseases and other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B) (based on reporting data specified by the [State](/usc/42/619.md?p=5) on HCFA Form 64 as mental health DSH, and as approved by the [Secretary](/usc/42/1301.md?p=a-6)). - (2) **Applicable percentage—** - (A) **In general—** For purposes of [paragraph (1)](#h-1), the applicable percentage with respect to— - (i) each of [fiscal years](/usc/42/619.md?p=3) 1998, 1999, and 2000, is the percentage determined under [subparagraph (B)](#h-2-B); or - (ii) a succeeding [fiscal year](/usc/42/619.md?p=3) is the lesser of the percentage determined under [subparagraph (B)](#h-2-B) or the following percentage: - (I) For [fiscal year](/usc/42/619.md?p=3) 2001, 50 percent. - (II) For [fiscal year](/usc/42/619.md?p=3) 2002, 40 percent. - (III) For each succeeding [fiscal year](/usc/42/619.md?p=3), 33 percent. - (B) **1995 percentage—** The percentage determined under this subparagraph is the ratio (determined as a percentage) of— - (i) the Federal share of payment adjustments made to [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) under [subsection (c)](#c) that are attributable to the 1995 DSH allotment for the [State](/usc/42/619.md?p=5) (as reported by the [State](/usc/42/619.md?p=5) not later than January 1, 1997, on HCFA Form 64, and as approved by the [Secretary](/usc/42/1301.md?p=a-6)) for payments to institutions for mental diseases and other mental health [facilities](/usc/42/1320a–3.md?p=c-5-B), to - (ii) the [State](/usc/42/619.md?p=5) 1995 DSH spending amount. - (C) **State 1995 DSH spending amount—** For purposes of [subparagraph (B)(ii)](#h-2-B-ii), the “[State](/usc/42/619.md?p=5) 1995 DSH spending amount”, with respect to a [State](/usc/42/619.md?p=5), is the [Federal medical assistance percentage](/usc/42/1396d.md?p=b) (for [fiscal year](/usc/42/619.md?p=3) 1995) of the payment adjustments made under [subsection (c)](#c) under the [State](/usc/42/619.md?p=5) plan that are attributable to the [fiscal year](/usc/42/619.md?p=3) 1995 DSH allotment for the [State](/usc/42/619.md?p=5) (as reported by the [State](/usc/42/619.md?p=5) not later than January 1, 1997, on HCFA Form 64, and as approved by the [Secretary](/usc/42/1301.md?p=a-6)). - (i) **Requirement for direct payment—** - (1) **In general—** No payment may be made under [section 1396b(a)(1) of this title](/usc/42/1396b.md?p=a-1) with respect to a payment adjustment made under this section, for services furnished by a [hospital](/usc/42/300s–3.md?p=1) on or after October 1, 1997, with respect to individuals eligible for [medical assistance](/usc/42/1396d.md?p=a) under the [State](/usc/42/619.md?p=5) plan who are enrolled with a managed care entity (as defined in [section 1396u–2(a)(1)(B) of this title](/usc/42/1396u–2.md?p=a-1-B)) or under any other managed care arrangement unless a payment, equal to the amount of the payment adjustment— - (A) is made directly to the [hospital](/usc/42/300s–3.md?p=1) by the [State](/usc/42/619.md?p=5); and - (B) is not used to determine the amount of a prepaid capitation payment under the [State](/usc/42/619.md?p=5) plan to the entity or arrangement with respect to such individuals. - (2) **Exception for current arrangements—** [Paragraph (1)](#i-1) shall not apply to a payment adjustment provided pursuant to a payment arrangement in effect on July 1, 1997. - (j) **Annual reports and other requirements regarding payment adjustments—** With respect to [fiscal year](/usc/42/619.md?p=3) 2004 and each [fiscal year](/usc/42/619.md?p=3) thereafter, the [Secretary](/usc/42/1301.md?p=a-6) shall require a [State](/usc/42/619.md?p=5), as a condition of receiving a payment under [section 1396b(a)(1) of this title](/usc/42/1396b.md?p=a-1) with respect to a payment adjustment made under this section, to do the following: - (1) **Report—** The [State](/usc/42/619.md?p=5) shall submit an annual report that [includes](/usc/42/1301.md?p=b) the following: - (A) An identification of each disproportionate share [hospital](/usc/42/300s–3.md?p=1) that received a payment adjustment under this section for the preceding [fiscal year](/usc/42/619.md?p=3) and the amount of the payment adjustment made to such [hospital](/usc/42/300s–3.md?p=1) for the preceding [fiscal year](/usc/42/619.md?p=3). - (B) Such other information as the [Secretary](/usc/42/1301.md?p=a-6) determines necessary to ensure the appropriateness of the payment adjustments made under this section for the preceding [fiscal year](/usc/42/619.md?p=3). - (2) **Independent certified audit—** The [State](/usc/42/619.md?p=5) shall annually submit to the [Secretary](/usc/42/1301.md?p=a-6) an independent certified audit that verifies each of the following: - (A) The extent to which [hospitals](/usc/42/300s–3.md?p=1) in the [State](/usc/42/619.md?p=5) have reduced their uncompensated care costs to reflect the total amount of claimed expenditures made under this section. - (B) Payments under this section to [hospitals](/usc/42/300s–3.md?p=1) that comply with the requirements of [subsection (g)](#g). - (C) Only the uncompensated care costs of providing inpatient [hospital](/usc/42/300s–3.md?p=1) and outpatient [hospital](/usc/42/300s–3.md?p=1) services to individuals described in [paragraph (1)(A)](#j-1-A) of such subsection are included in the calculation of the [hospital](/usc/42/300s–3.md?p=1)-specific limits under such subsection. - (D) The [State](/usc/42/619.md?p=5) included all payments under this subchapter, [including](/usc/42/1301.md?p=b) supplemental payments, in the calculation of such [hospital](/usc/42/300s–3.md?p=1)-specific limits. - (E) The [State](/usc/42/619.md?p=5) has separately documented and retained a record of all of its costs under this subchapter, claimed expenditures under this subchapter, uninsured costs in determining payment adjustments under this section, and any payments made on behalf of the uninsured from payment adjustments under this section. ## Footnotes [^1]: So in original. Probably should be “subsection”. [^2]: So in original. Probably should be preceded by “a”. ## Source credit (Aug. 14, 1935, ch. 531, title XIX, § 1923, formerly Pub. L. 100–203, title IV, § 4112, Dec. 22, 1987, 101 Stat. 1330–148; renumbered § 1923 of act Aug. 14, 1935, and amended Pub. L. 100–360, title III, § 302(b)(2), title IV, § 411(k)(6)(A)–(B)(ix), July 1, 1988, 102 Stat. 752, 792–794; Pub. L. 100–485, title VI, § 608(d)(15)(C), (26)(A)–(F), Oct. 13, 1988, 102 Stat. 2417, 2421, 2422; Pub. L. 101–239, title VI, § 6411(c)(1), Dec. 19, 1989, 103 Stat. 2270; Pub. L. 101–508, title IV, §§ 4702(a), 4703(a)–(c), Nov. 5, 1990, 104 Stat. 1388–171; Pub. L. 102–234, §§ 3(b)(1), (2)(A), (c), Dec. 12, 1991, 105 Stat. 1799, 1802, 1803; Pub. L. 103–66, title XIII, § 13621(a)(1), (b)(1), (2), Aug. 10, 1993, 107 Stat. 629–631; Pub. L. 105–33, title IV, §§ 4711(c)(2), 4721(a)(1), (b)–(d), Aug. 5, 1997, 111 Stat. 508, 511, 513, 514; Pub. L. 106–113, div. B, § 1000(a)(6) [title VI, §§ 601(a), 608(s)], Nov. 29, 1999, 113 Stat. 1536, 1501A–394, 1501A–397; Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(1), (2), (b)(2)], Dec. 21, 2000, 114 Stat. 2763, 2763A–569, 2763A–570; Pub. L. 108–173, title X, § 1001(a)–(d), Dec. 8, 2003, 117 Stat. 2428–2430; Pub. L. 109–171, title VI, § 6054(a), Feb. 8, 2006, 120 Stat. 96; Pub. L. 109–432, div. B, title IV, § 404, Dec. 20, 2006, 120 Stat. 2995; Pub. L. 110–173, title II, § 204, Dec. 29, 2007, 121 Stat. 2513; Pub. L. 110–275, title II, § 202, July 15, 2008, 122 Stat. 2591; Pub. L. 111–3, title VI, § 616, Feb. 4, 2009, 123 Stat. 103; Pub. L. 111–5, div. B, title V, § 5002, Feb. 17, 2009, 123 Stat. 502; Pub. L. 111–148, title II, § 2551(a), title X, § 10201(e), Mar. 23, 2010, 124 Stat. 312, 920; Pub. L. 111–152, title I, § 1203, Mar. 30, 2010, 124 Stat. 1053; Pub. L. 112–96, title III, § 3203, Feb. 22, 2012, 126 Stat. 193; Pub. L. 112–240, title VI, § 641, Jan. 2, 2013, 126 Stat. 2357; Pub. L. 113–67, div. B, title II, § 1204(a), Dec. 26, 2013, 127 Stat. 1199; Pub. L. 113–93, title II, § 221(a), Apr. 1, 2014, 128 Stat. 1076; Pub. L. 114–10, title II, § 219, title IV, § 412, Apr. 16, 2015, 129 Stat. 153, 162; Pub. L. 115–123, div. E, title XII, § 53101, Feb. 9, 2018, 132 Stat. 298; Pub. L. 116–59, div. B, title III, § 1303, Sept. 27, 2019, 133 Stat. 1105; Pub. L. 116–69, div. B, title III, § 1303, Nov. 21, 2019, 133 Stat. 1137; Pub. L. 116–94, div. N, title I, § 203, Dec. 20, 2019, 133 Stat. 3111; Pub. L. 116–136, div. A, title III, § 3813, Mar. 27, 2020, 134 Stat. 429; Pub. L. 116–159, div. C, title III, § 2303, Oct. 1, 2020, 134 Stat. 732; Pub. L. 116–215, div. B, title I, § 1106, Dec. 11, 2020, 134 Stat. 1043; Pub. L. 116–260, div. CC, title II, §§ 201, 203(a), Dec. 27, 2020, 134 Stat. 2977, 2978; Pub. L. 117–2, title IX, § 9819(a), Mar. 11, 2021, 135 Stat. 218; Pub. L. 117–7, § 2(b), Apr. 14, 2021, 135 Stat. 252; Pub. L. 118–15, div. B, title III, § 2341, Sept. 30, 2023, 137 Stat. 96; Pub. L. 118–22, div. B, title II, § 301, Nov. 17, 2023, 137 Stat. 121; Pub. L. 118–35, div. B, title I, § 121, Jan. 19, 2024, 138 Stat. 6; Pub. L. 118–42, div. G, title I, § 210, Mar. 9, 2024, 138 Stat. 414; Pub. L. 118–158, div. C, title IV, § 3401, Dec. 21, 2024, 138 Stat. 1767; Pub. L. 119–4, div. B, title IV, § 2401, Mar. 15, 2025, 139 Stat. 45; Pub. L. 119–37, div. F, title IV, § 6401, Nov. 12, 2025, 139 Stat. 636; Pub. L. 119–75, div. J, title I, §§ 6105, 6106(a), Feb. 3, 2026, 140 Stat. 643.) ## Notes ### Editorial Notes ### References in Text Section 6008 of the Families First Coronavirus Response Act, referred to in subsec. (f)(3)(F), is section 6008 of Pub. L. 116–127, which amended section 1396d of this title and enacted provisions set out as a note under section 1396d of this title. Section 4721(e) of the Balanced Budget Act of 1997, and amended by section 607 of the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (Public Law 106–113), referred to in subsec. (g)(3), is Pub. L. 105–33, title IV, § 4721(e), Aug. 5, 1997, 111 Stat. 514, as amended by Pub. L. 106–113, div. B, § 1000(a)(6) [title VI, § 607(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A–396, which is set out as a note under this section. ### Codification Prior to redesignation by Pub. L. 100–360, section 4112 of Pub. L. 100–203, cited in the credits to this section, was classified as a note under section 1396a of this title. ### Prior Provisions A prior section 1923 of act Aug. 14, 1935, was renumbered section 1939 and is classified to section 1396v of this title. ### Amendments 2026—Subsec. (f)(6)(A)(vi). Pub. L. 119–75, § 6105(a), substituted “2027” for “2025 and a portion of fiscal year 2026” in heading and, in text, inserted “, and the DSH allotment for Tennessee for the portion of fiscal year 2026 beginning on January 31, 2026, and ending September 30, 2026, shall be $35,351,507, which may be claimed as fiscal year 2026 uncompensated care costs, and the DSH allotment for Tennessee for fiscal year 2027, shall be $53,100,000” before period at end. Subsec. (f)(7)(A)(i). Pub. L. 119–75, § 6105(b)(1)(A), substituted “fiscal year 2028” for “the period beginning January 31, 2026, and ending September 30, 2026, and for each of fiscal years 2027 and 2028” in introductory provisions. Subsec. (f)(7)(A)(i)(I). Pub. L. 119–75, § 6105(b)(1)(B), struck out “or period” after “the fiscal year”. Subsec. (f)(7)(A)(i)(II). Pub. L. 119–75, § 6105(b)(1)(C), struck out “or period” after “in the fiscal year”. Subsec. (f)(7)(A)(ii). Pub. L. 119–75, § 6105(b)(2), substituted “fiscal year 2028” for “the period beginning January 31, 2026, and ending September 30, 2026, and for each of fiscal years 2027 and 2028”. Subsec. (g)(1)(A). Pub. L. 119–75, § 6106(a)(1)(A)(i), struck out “(other than a hospital described in paragraph (2)(B))” after “to a hospital” in introductory provisions. Subsec. (g)(1)(A)(i). Pub. L. 119–75, § 6106(a)(1)(A)(ii), inserted “with respect to such hospital and year” after “described in subparagraph (B)”. Subsec. (g)(1)(A)(ii)(III). Pub. L. 119–75, § 6106(a)(1)(A)(iii), added subcl. (III). Subsec. (g)(1)(B). Pub. L. 119–75, § 6106(a)(1)(B)(i), substituted “in this subparagraph are, with respect to a hospital and a year,” for “in this clause are” in introductory provisions. Subsec. (g)(1)(B)(iii). Pub. L. 119–75, § 6106(a)(1)(B)(ii), added cl. (iii). Subsec. (g)(2), (3). Pub. L. 119–75, § 6106(a)(2)–(4), redesignated par. (3) as (2), substituted “Paragraph (2)” for “Notwithstanding paragraph (2) of this subsection (as in effect on October 1, 2021), paragraph (2)”, and struck out former par. (2) which related to application of limits for certain hospitals. 2025—Subsec. (f)(6)(A)(vi). Pub. L. 119–37, § 6401(a), inserted “and a portion of fiscal year 2026” after “2025” in heading and, in text, inserted “, and the DSH allotment for Tennessee for the portion of fiscal year 2026 beginning October 1, 2025, and ending January 30, 2026, shall be $17,748,493, which may be claimed as fiscal year 2026 uncompensated care costs” before period at end. Subsec. (f)(7)(A)(i). Pub. L. 119–37, § 6401(b)(1)(A)(i), substituted “For the period beginning January 31, 2026, and ending September 30, 2026, and for each of fiscal years 2027 and 2028” for “For each of fiscal years 2026 through 2028” in introductory provisions. Pub. L. 119–4, § 2401(1)(A), substituted “For” for “For the period beginning April 1, 2025, and ending September 30, 2025, and for” and “through 2028” for “through 2027” in introductory provisions. Subsec. (f)(7)(A)(i)(I). Pub. L. 119–37, § 6401(b)(1)(A)(ii), inserted “or period” after “the fiscal year”. Pub. L. 119–4, § 2401(1)(B), struck out “or period” after “fiscal year”. Subsec. (f)(7)(A)(i)(II). Pub. L. 119–37, § 6401(b)(1)(A)(iii), inserted “or period” after “in the fiscal year”. Pub. L. 119–4, § 2401(1)(C), which directed amendment of subcl. (II) by striking out “or period” without specifying the location of such amendment, was executed by striking out “or period” after “fiscal year” both places appearing, to reflect the probable intent of Congress. Subsec. (f)(7)(A)(ii). Pub. L. 119–37, § 6401(b)(1)(B), substituted “for the period beginning January 31, 2026, and ending September 30, 2026, and for each of fiscal years 2027 and 2028” for “for each of fiscal years 2026 through 2028”. Pub. L. 119–4, § 2401(2), struck out “for the period beginning April 1, 2025, and ending September 30, 2025, and” after “$8,000,000,000” and substituted “through 2028” for “through 2027”. Subsec. (f)(8). Pub. L. 119–37, § 6401(b)(2), substituted “2028” for “2027”. 2024—Subsec. (f)(7)(A). Pub. L. 118–158 substituted “April 1” for “January 1” in introductory provisions of cl. (i) and in cl. (ii). Pub. L. 118–42, in introductory provisions of cl. (i), substituted “For the period beginning January 1, 2025, and ending September 30, 2025, and for each of fiscal years 2026” for “For the period beginning March 9, 2024, and ending September 30, 2024, and for each of fiscal years 2025” and, in cl. (ii), substituted “January 1, 2025, and ending September 30, 2025, and for each of fiscal years 2026” for “March 9, 2024, and ending September 30, 2024, and for each of fiscal years 2025”. Pub. L. 118–35 substituted “March 9, 2024” for “January 20, 2024” in introductory provisions of cl. (i) and in cl. (ii). 2023—Subsec. (f)(7)(A)(i). Pub. L. 118–22, § 301(1), substituted “January 20, 2024” for “November 18, 2023” in introductory provisions. Pub. L. 118–15, § 2341(1), substituted “For the period beginning November 18, 2023, and ending September 30, 2024, and for each of fiscal years 2025 through 2027” for “For each of fiscal years 2024 through 2027” in introductory provisions and inserted “or period” after “the fiscal year” wherever appearing in subcls. (I) and (II). Subsec. (f)(7)(A)(ii). Pub. L. 118–22, § 301(2), substituted “January 20, 2024” for “November 18, 2023”. Pub. L. 118–15, § 2341(2), substituted “for the period beginning November 18, 2023, and ending September 30, 2024, and for each of fiscal years 2025 through 2027.” for “for each of fiscal years 2024 through 2027”. 2021—Subsec. (f)(3)(A). Pub. L. 117–2, § 9819(a)(1), substituted “subparagraphs (E) and (F)” for “subparagraph (E)”. Subsec. (f)(3)(F). Pub. L. 117–2, § 9819(a)(2), added subpar. (F). Subsec. (g)(3). Pub. L. 117–7 added par. (3). 2020—Subsec. (f)(7)(A)(i). Pub. L. 116–260, § 201(1)(A), substituted “For each of fiscal years 2024 through 2027,” for “For the period beginning December 19, 2020, and ending September 30, 2021, and for each of fiscal years 2022 through 2025” in introductory provisions. Pub. L. 116–215 substituted “December 19, 2020” for “December 12, 2020” in introductory provisions. Pub. L. 116–159, § 2303(1), substituted “December 12, 2020” for “December 1, 2020” in introductory provisions. Pub. L. 116–136, § 3813(1), substituted “December 1, 2020, and ending September 30, 2021, and for each of fiscal years 2022” for “May 23, 2020, and ending September 30, 2020, and for each of fiscal years 2021” in introductory provisions. Subsec. (f)(7)(A)(ii). Pub. L. 116–260, § 201(1)(B), substituted “equal to $8,000,000,000 for each of fiscal years 2024 through 2027” for “equal to— “(I) $4,000,000,000 for the period beginning December 19, 2020, and ending September 30, 2021; and “(II) $8,000,000,000 for each of fiscal years 2022 through 2025.” Subsec. (f)(7)(A)(ii)(I). Pub. L. 116–215 substituted “December 19, 2020” for “December 12, 2020”. Pub. L. 116–159, § 2303(2), substituted “December 12, 2020” for “December 1, 2020”. Pub. L. 116–136, § 3813(2)(A), substituted “December 1, 2020, and ending September 30, 2021” for “May 23, 2020, and ending September 30, 2020”. Subsec. (f)(7)(A)(ii)(II). Pub. L. 116–136, § 3813(2)(B), substituted “2022” for “2021”. Subsec. (f)(8). Pub. L. 116–260, § 201(2), substituted “2027” for “2025”. Subsec. (g). Pub. L. 116–260, § 203(a), amended subsec. (g) generally. Prior to amendment, subsec. (g) related to limit on amount of payment to hospital. 2019—Subsec. (f)(7)(A). Pub. L. 116–94 substituted “May 23, 2020” for “December 21, 2019” in cls. (i) and (ii)(I). Pub. L. 116–69 substituted “December 21, 2019” for “November 22, 2019” in cls. (i) and (ii)(I). Subsec. (f)(7)(A)(i). Pub. L. 116–59, § 1303(1), in introductory provisions, substituted “For the period beginning November 22, 2019, and ending September 30, 2020, and for each of fiscal years 2021 through 2025” for “For each of fiscal years 2020 through 2025”. Subsec. (f)(7)(A)(ii)(I). Pub. L. 116–59, § 1303(2), substituted “for the period beginning November 22, 2019, and ending September 30, 2020” for “for fiscal year 2020”. 2018—Subsec. (f)(7)(A)(i). Pub. L. 115–123, § 53101(1), substituted “2020” for “2018” in introductory provisions. Subsec. (f)(7)(A)(ii)(I) to (VIII). Pub. L. 115–123, § 53101(2), added subcls. (I) and (II) and struck out former subcls. (I) to (VIII) which related to fiscal years 2018 to 2025, respectively. 2015—Subsec. (f)(6)(A)(vi). Pub. L. 114–10, § 219, added cl. (vi). Subsec. (f)(7)(A)(i). Pub. L. 114–10, § 412(1)(A), substituted “2018 through 2025” for “2017 through 2024” in introductory provisions. Subsec. (f)(7)(A)(ii). Pub. L. 114–10, § 412(1)(B), added cl. (ii) and struck out former cl. (ii) which related to aggregate reductions for fiscal years 2017 to 2024. Subsec. (f)(7)(A)(v). Pub. L. 114–10, § 412(1)(C), added cl. (v). Subsec. (f)(8). Pub. L. 114–10, § 412(2), substituted “2025” for “2024”. 2014—Subsec. (f)(7)(A)(i). Pub. L. 113–93, § 221(a)(1)(A), substituted “2017 through 2024” for “2016 through 2020” in introductory provisions. Subsec. (f)(7)(A)(ii)(I) to (VIII). Pub. L. 113–93, § 221(a)(1)(B), added subcls. (I) to (VIII) and struck out former subcls. (I) to (IV) which related to amounts for fiscal years 2016 to 2019. Subsec. (f)(8). Pub. L. 113–93, § 221(a)(2), added par. (8) and struck out former par. (8) which related to special rules for calculating DSH allotments for certain fiscal years. 2013—Subsec. (f)(7)(A)(i). Pub. L. 113–67, § 1204(a)(1)(A), substituted “2016” for “2014” in introductory provisions. Subsec. (f)(7)(A)(ii). Pub. L. 113–67, § 1204(a)(1)(B), redesignated subcls. (III) to (VII) as subcls. (I) to (V), respectively, in subcl. (I), substituted “$1,200,000,000” for “$600,000,000”, and struck out former subcls. (I) and (II) which read as follows: “(I) $500,000,000 for fiscal year 2014; “(II) $600,000,000 for fiscal year 2015;”. Subsec. (f)(8). Pub. L. 112–240 amended par. (8) generally. Prior to amendment, text read as follows: “With respect to fiscal year 2021, for purposes of applying paragraph (3)(A) to determine the DSH allotment for a State, the amount of the DSH allotment for the State under paragraph (3) for fiscal year 2020 shall be equal to the DSH allotment as reduced under paragraph (7).” Subsec. (f)(8)(C), (D). Pub. L. 113–67, § 1204(a)(2), added subpar. (C) and redesignated former subpar. (C) as (D), and in subpar. (D), substituted “fiscal year 2023” for “fiscal year 2022”. 2012—Subsec. (f)(3)(A). Pub. L. 112–96, § 3203(2), substituted “paragraphs (6), (7), and (8)” for “paragraphs (6) and (7)”. Subsec. (f)(8), (9). Pub. L. 112–96, § 3203(1), (3), added par. (8) and redesignated former par. (8) as (9). 2010—Subsec. (f)(1). Pub. L. 111–148, § 2551(a)(1), substituted “, (3), and (7)” for “and (3)”. Subsec. (f)(3)(A). Pub. L. 111–148, § 2551(a)(2), substituted “paragraphs (6) and (7)” for “paragraph (6)”. Subsec. (f)(6). Pub. L. 111–148, § 10201(e)(1)(A)(i), substituted “Allotment adjustments” for “Allotment adjustments for fiscal years 2007 through 2011 and the first calendar quarter of fiscal year 2012” in heading. Subsec. (f)(6)(A)(v). Pub. L. 111–152, § 1203(b), added cl. (v). Subsec. (f)(6)(B)(iii). Pub. L. 111–152, § 1203(a)(1), struck out “or paragraph (7)” after “paragraph (2)” in introductory provisions. Pub. L. 111–148, § 10201(e)(1)(A)(ii), added cl. (iii). Subsec. (f)(7). Pub. L. 111–152, § 1203(a)(2), added par. (7) and struck out former par. (7) which related to reduction of State DSH allotments once reduction in uninsured threshold reached. Pub. L. 111–148, § 2551(a)(4), added par. (7). Former par. (7) redesignated (8). Subsec. (f)(7)(A). Pub. L. 111–148, § 10201(e)(1)(B)(i), substituted “subparagraphs (E) and (G)” for “subparagraph (E)” in introductory provisions. Subsec. (f)(7)(B)(i). Pub. L. 111–148, § 10201(e)(1)(B)(ii)(I), added subcls. (I) to (IV) and struck out former subcls. (I) and (II) which read as follows: “(I) if the State is a low DSH State described in paragraph (5)(B), the applicable percentage is equal to 25 percent; and “(II) if the State is any other State, the applicable percentage is 50 percent.” Subsec. (f)(7)(B)(ii). Pub. L. 111–148, § 10201(e)(1)(B)(ii)(II), added subcls. (I) to (IV) and struck out former subcls. (I) and (II) which read as follows: “(I) if the State is a low DSH State described in paragraph (5)(B), the applicable percentage is equal to the product of the percentage reduction in uncovered individuals for the fiscal year from the preceding fiscal year and 25 percent; and “(II) if the State is any other State, the applicable percentage is equal to the product of the percentage reduction in uncovered individuals for the fiscal year from the preceding fiscal year and 50 percent.” Subsec. (f)(7)(E). Pub. L. 111–148, § 10201(e)(1)(B)(ii)(III), which directed amendment of par. (7)(B) by substituting “50 percent” for “35 percent” in subpar. (E), was executed by making the substitution in par. (7)(E) to reflect the probable intent of Congress. Subsec. (f)(7)(G). Pub. L. 111–148, § 10201(e)(1)(B)(ii)(IV), which directed amendment of par. (7)(B) by adding subpar. (G) at the end, was executed by adding subpar. (G) at end of par. (7) to reflect the probable intent of Congress. Subsec. (f)(8). Pub. L. 111–148, § 2551(a)(3), redesignated par. (7) as (8). 2009—Subsec. (f)(3)(A). Pub. L. 111–5, § 5002(1), substituted “paragraph (6) and subparagraph (E)” for “paragraph (6)”. Subsec. (f)(3)(E). Pub. L. 111–5, § 5002(2), added subpar. (E). Subsec. (f)(6). Pub. L. 111–3, § 616(1), substituted “2011 and the first calendar quarter of fiscal year 2012” for “2009 and the first calendar quarter of fiscal year 2010” in heading. Subsec. (f)(6)(A)(i). Pub. L. 111–3, § 616(2)(A), in concluding provisions, substituted “fiscal years 2008, 2009, 2010, and 2011, the DSH allotment for Tennessee for” for “fiscal years 2008 and 2009, the DSH allotment for Tennessee for such portion of” and “2012 for the period ending on December 31, 2011” for “2010 for the period ending on December 31, 2009”. Subsec. (f)(6)(A)(ii). Pub. L. 111–3, § 616(2)(B), substituted “2010, 2011, or for period in fiscal year 2012” for “or for a period in fiscal year 2010”. Subsec. (f)(6)(A)(iv). Pub. L. 111–3, § 616(2)(C)(i), substituted “2011 and the first calendar quarter of fiscal year 2012” for “2009 and the first calendar quarter of fiscal year 2010” in heading. Subsec. (f)(6)(A)(iv)(I), (II). Pub. L. 111–3, § 616(2)(C)(ii), substituted “2010, 2011, or for a period in fiscal year 2012” for “or for a period in fiscal year 2010”. Subsec. (f)(6)(B)(i). Pub. L. 111–3, § 616(3)(A), substituted “2007 through 2011” for “2007 through 2009” and “2012 for the period ending on December 31, 2011” for “2010 for the period ending on December 31, 2009”. 2008—Subsec. (f)(6). Pub. L. 110–275, § 202(1), substituted “fiscal years 2007 through 2009 and the first calendar quarter of fiscal year 2010” for “for fiscal year 2007 and portions of fiscal year 2008” in heading. Subsec. (f)(6)(A)(i). Pub. L. 110–275, § 202(2)(A), in concluding provisions, substituted “fiscal years 2008 and 2009” for “fiscal year 2008 for the period ending on June 30, 2008”, struck out “¾ of” before “the amount specified in the previous sentence”, and inserted “Only with respect to fiscal year 2010 for the period ending on December 31, 2009, the DSH allotment for Tennessee for such portion of the fiscal year, notwithstanding such table or terms, shall be ¼ of the amount specified in the first sentence for fiscal year 2007.” at end. Subsec. (f)(6)(A)(ii). Pub. L. 110–275, § 202(2)(B), substituted “, 2008, 2009, or for a period in fiscal year 2010” for “or for a period in fiscal year 2008”. Subsec. (f)(6)(A)(iv). Pub. L. 110–275, § 202(2)(C), substituted “fiscal years 2007 through 2009 and the first calendar quarter of fiscal year 2010” for “fiscal year 2007 and fiscal year 2008” in heading and “, 2008, 2009, or for a period in fiscal year 2010” for “or for a period in fiscal year 2008” in subcls. (I) and (II). Subsec. (f)(6)(B)(i). Pub. L. 110–275, § 202(3), substituted “each of fiscal years 2007 through 2009” for “fiscal year 2007” in first sentence, inserted last sentence, and struck out former last sentence which read as follows: “Only with respect to fiscal year 2008 for the period ending on June 30, 2008, the DSH allotment for Hawaii for such portion of the fiscal year, notwithstanding the table set forth in paragraph (2), shall be $7,500,000.” 2007—Subsec. (f)(6). Pub. L. 110–173, § 204(1), inserted “and portions of fiscal year 2008” after “fiscal year 2007” in heading. Subsec. (f)(6)(A)(i). Pub. L. 110–173, § 204(2)(A), inserted concluding provisions. Subsec. (f)(6)(A)(ii). Pub. L. 110–173, § 204(2)(B), inserted “or for a period in fiscal year 2008 described in clause (i)” after “fiscal year 2007” and “or period” after “such fiscal year”. Subsec. (f)(6)(A)(iv). Pub. L. 110–173, § 204(2)(C), inserted “and fiscal year 2008” after “fiscal year 2007” in heading, “or for a period in fiscal year 2008 described in clause (i)” after “fiscal year 2007” in subcls. (I) and (II), “or period” after “for such fiscal year” in subcl. (I), and “or period” after “such fiscal year” in two places in subcl. (II). Subsec. (f)(6)(B)(i). Pub. L. 110–173, § 204(3), inserted at end “Only with respect to fiscal year 2008 for the period ending on June 30, 2008, the DSH allotment for Hawaii for such portion of the fiscal year, notwithstanding the table set forth in paragraph (2), shall be $7,500,000.” 2006—Subsec. (f)(2). Pub. L. 109–171 under each of the columns for FY 00, FY 01, and FY 02, substituted “49” for “32” in the entry for the District of Columbia. Subsec. (f)(6). Pub. L. 109–432 amended heading and text of par. (6) generally, substituting provisions relating to allotment adjustments for fiscal year 2007 in Tennessee and Hawaii for provisions relating to allotment adjustments with respect to fiscal year 2004 or 2005 in any State if a statewide waiver had been revoked or terminated before the end of either such fiscal year and there had been no DSH allotment for the State. 2003—Subsec. (f)(3)(A). Pub. L. 108–173, § 1001(a)(1), (c)(1), substituted “Except as provided in paragraph (6), the DSH” for “The DSH” and “subparagraphs (B) and (C)” for “subparagraph (B)”. Subsec. (f)(3)(C), (D). Pub. L. 108–173, § 1001(a)(2), added subpars. (C) and (D). Subsec. (f)(5). Pub. L. 108–173, § 1001(b)(1), (2), (4), struck out “extremely” before “low DSH States” in heading, designated existing provisions as subpar. (A) and inserted subpar. heading, and added subpar. (B). Subsec. (f)(5)(A). Pub. L. 108–173, § 1001(b)(3), which directed insertion of “before fiscal year 2004” after “In subsequent years”, was executed by making the insertion after “In subsequent fiscal years” to reflect the probable intent of Congress. Subsec. (f)(6), (7). Pub. L. 108–173, § 1001(c)(2), (3), added par. (6) and redesignated former par. (6) as (7). Subsec. (j). Pub. L. 108–173, § 1001(d), added subsec. (j). 2000—Subsec. (a)(2)(D). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(b)(2)(A)], inserted “(including such patients who receive benefits through a managed care entity)” after “the proportion of low-income and medicaid patients”. Subsec. (b)(2). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(b)(2)(B)], inserted “(regardless of whether such patients receive medical assistance on a fee-for-service basis or through a managed care entity)” after “a State plan approved under this subchapter in a period”. Subsec. (b)(3)(A)(i)(I). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(b)(2)(C)], inserted “(regardless of whether the services were furnished on a fee-for-service basis or through a managed care entity)” after “under a State plan under this subchapter”. Subsec. (f)(2). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(1)(A)(i)], substituted “Subject to paragraph (4), the DSH allotment” for “The DSH allotment” in introductory provisions. Subsec. (f)(3)(A). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(2)(B)], inserted “and paragraph (5)” after “subparagraph (B)”. Subsec. (f)(4). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(1)(A)(iii)], added par. (4). Former par. (4) redesignated (6). Subsec. (f)(5). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(2)(A)], added par. (5). Subsec. (f)(6). Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(1)(A)(ii)], redesignated par. (4) as (6). 1999—Subsec. (c)(3)(B). Pub. L. 106–113, § 1000(a)(6) [title VI, § 608(s)], substituted comma for period at end. Subsec. (f)(2). Pub. L. 106–113, § 1000(a)(6) [title VI, § 601(a)], under each of the columns for FY 00, FY 01, and FY 02, substituted “32” for “23” in the entry for the District of Columbia, “33” for “16” in the entry for Minnesota, “9” for “5” in the entry for New Mexico, and “0.1” for “0” in the entry for Wyoming. 1997—Subsec. (a)(1). Pub. L. 105–33, § 4711(c)(2), substituted “1396a(a)(13)(A)(iv)” for “1396a(a)(13)(A)”. Subsec. (a)(2)(D). Pub. L. 105–33, § 4721(c), added subpar. (D). Subsec. (e)(1). Pub. L. 105–33, § 4711(c)(2), substituted “1396a(a)(13)(A)(iv)” for “1396a(a)(13)(A)”. Subsec. (f). Pub. L. 105–33, § 4721(a)(1), amended heading and text of subsec. (f) generally. Prior to amendment, subsec. (f) related to denial of Federal financial participation for payments in excess of certain limits. Subsec. (h). Pub. L. 105–33, § 4721(b), added subsec. (h). Subsec. (i). Pub. L. 105–33, § 4721(d), added subsec. (i). 1993—Subsec. (a)(1)(A). Pub. L. 103–66, § 13621(a)(1)(A), substituted “requirements” for “requirement”. Subsec. (b)(1). Pub. L. 103–66, § 13621(a)(1)(B), substituted “requirements” for “requirement” in introductory provisions. Subsec. (c). Pub. L. 103–66, § 13621(b)(2)(A), substituted “subsections (f) and (g)” for “subsection (f)” in introductory provisions. Subsec. (d). Pub. L. 103–66, § 13621(a)(1)(C), substituted “Requirements” for “Requirement” in heading. Subsec. (d)(3). Pub. L. 103–66, § 13621(a)(1)(D), added par. (3). Subsec. (e)(1)(C). Pub. L. 103–66, § 13621(a)(1)(E), added cl. (C). Subsec. (e)(2)(A). Pub. L. 103–66, § 13621(a)(1)(F)(i), inserted “(other than the last sentence of subsection (c))” before “shall not apply”. Subsec. (e)(2)(C). Pub. L. 103–66, § 13621(a)(1)(F)(ii)–(iv), added subpar. (C). Subsec. (e)(2)(D). Pub. L. 103–66, § 13621(b)(2)(B), added subpar. (D). Subsec. (g). Pub. L. 103–66, § 13621(b)(1), added subsec. (g). 1991—Subsec. (a)(2)(B). Pub. L. 102–234, § 3(b)(2)(A)(i), substituted “subsections (c) and (f)” for “subsection (c)”. Subsec. (b)(4). Pub. L. 102–234, § 3(c), added par. (4). Subsec. (c). Pub. L. 102–234, § 3(b)(2)(A)(ii), substituted “Subject to subsection (f), in order” for “In order”. Subsec. (f). Pub. L. 102–234, § 3(b)(1), added subsec. (f). 1990—Subsec. (b)(2). Pub. L. 101–508, § 4702(a), inserted at end “In this paragraph, the term ‘inpatient day’ includes each day in which an individual (including a newborn) is an inpatient in the hospital, whether or not the individual is in a specialized ward and whether or not the individual remains in the hospital for lack of suitable placement elsewhere.” Subsec. (c)(2). Pub. L. 101–508, § 4703(c), inserted before semicolon at end “or the hospital’s low-income utilization rate (as defined in paragraph (b)(3))”. Subsec. (c)(3). Pub. L. 101–508, § 4703(a), added par. (3). Subsec. (e)(2). Pub. L. 101–508, § 4703(b), struck out “during the 3-year period” before “beginning on”. 1989—Subsec. (e)(1). Pub. L. 101–239 designated portion of existing provisions as cls. (A) and (B), and in cl. (A) designated existing provisions as subcl. (i) and added subcl. (ii). 1988—Pub. L. 100–360, § 411(k)(6)(A)–(B)(ix), as amended by Pub. L. 100–485, § 608(d)(26)(F), amended Pub. L. 100–203, § 4112, so as to redesignate section 4112 of Pub. L. 100–203 as this section. Subsec. (a). Pub. L. 100–360, § 411(k)(6)(B)(iv), struck out “of Health and Human Services” after “to the Secretary” wherever appearing in pars. (1) and (2). Subsec. (a)(1). Pub. L. 100–360, § 411(k)(6)(B)(ii), (iii), substituted “A State plan under this subchapter” for “A State’s plan under title XIX of the Social Security Act”, and made technical amendment to reference to section 1396a(a)(13)(A) of this title involving underlying provisions of original act. Subsec. (a)(2)(A). Pub. L. 100–360, § 411(k)(6)(A)(i), substituted “April 1, 1989” for “such date” and inserted before period at end “, effective for inpatient hospital services provided on or after July 1, 1989”. Subsec. (a)(2)(B). Pub. L. 100–360, § 411(k)(6)(A)(ii), substituted “April 1, 1990” for “such date” and inserted before period at end “, effective for inpatient hospital services provided on or after July 1, 1990”. Subsec. (a)(2)(C). Pub. L. 100–485, § 608(d)(15)(C), realigned the margin of subpar. (C). Pub. L. 100–360, § 302(b)(2), added subpar. (C). Subsec. (a)(3). Pub. L. 100–360, § 411(k)(6)(A)(iii), inserted par. (3) designation and substituted “90 days after the date a State submits an amendment” for “June 30 of each year in which the State is required to submit an amendment”. Subsec. (a)(4). Pub. L. 100–360, § 411(k)(6)(A)(iii)(II), (III), (B)(v), inserted par. (4) designation and made technical amendment to reference to section 1396n(b)(4) of this title involving underlying provisions of original act. Subsec. (b)(2). Pub. L. 100–360, § 411(k)(6)(A)(iv), substituted “a State plan” for “the State plan”. Pub. L. 100–360, § 411(k)(6)(B)(vi), as amended by Pub. L. 100–485, § 608(d)(26)(F), substituted “under this subchapter” for “under subchapter XIX of this chapter”. Subsec. (b)(3). Pub. L. 100–360, § 411(k)(6)(B)(vi), as amended by Pub. L. 100–485, § 608(d)(26)(F), substituted “under this subchapter” for “under subchapter XIX of this chapter” in last sentence. Subsec. (b)(3)(A)(i). Pub. L. 100–360, § 411(k)(6)(B)(vi), as amended by Pub. L. 100–485, § 608(d)(26)(F), substituted “under this subchapter” for “under subchapter XIX of this chapter”. Subsec. (b)(3)(B)(i). Pub. L. 100–485, § 608(d)(26)(D), inserted “of subparagraph (A)” after “clause (i)(II)”. Pub. L. 100–360, § 411(k)(6)(A)(v), inserted “, less the portion of any cash subsidies described in clause (i)(II) in the period reasonably attributable to inpatient hospital services” after “charity care in a period”. Subsec. (c). Pub. L. 100–485, § 608(d)(26)(E), substituted “this subsection” for “subsection (c)” in concluding provisions. Pub. L. 100–360, § 411(k)(6)(A)(vi)(I), (II), (V), in concluding provisions, substituted “paragraphs (1)(B) and (2)(A) of subsection (a)” for “paragraphs (2)(A) and (2)(B)”, “such paragraph (1)(B)” for “paragraph (2)(A)”, and “such paragraph (2)(A)” for “paragraph (2)(B)” and inserted “at least” before “one-third” and “two-thirds”. Pub. L. 100–360, § 411(k)(6)(A)(vi)(VI), inserted at end “In the case of a hospital described in subsection (d)(2)(A)(i) (relating to children’s hospitals), in computing the hospital’s disproportionate share adjustment percentage for purposes of paragraph (1)(B) of this subsection, the disproportionate patient percentage (defined in section 1395ww(d)(5)(F)(vi) of this title) shall be computed by substituting for the fraction described in subclause (I) of such section the fraction described in subclause (II) of that section. If a State elects in a State plan amendment under subsection (a) to provide the payment adjustment described in paragraph (2), the State must include in the amendment a detailed description of the specific methodology to be used in determining the specified additional payment amount (or increased percentage payment) to be made to each hospital qualifying for such a payment adjustment and must publish at least annually the name of each hospital qualifying for such a payment adjustment and the amount of such payment adjustment made for each such hospital.” Subsec. (c)(1). Pub. L. 100–360, § 411(k)(6)(A)(vi)(III), inserted “at least” after “equal to”. Subsec. (c)(2). Pub. L. 100–360, § 411(k)(6)(A)(vi)(IV), as amended by Pub. L. 100–485, § 608(d)(26)(A), inserted “(without regard to whether the hospital is described in subparagraph (A) or (B) of subsection (b)(1))” after “payment) and”. Subsec. (d)(1). Pub. L. 100–360, § 411(k)(6)(B)(vi), as amended by Pub. L. 100–485, § 608(d)(26)(F), substituted “under this subchapter” for “under subchapter XIX of this chapter”. Subsec. (d)(2)(B). Pub. L. 100–360, § 411(k)(6)(B)(vii), made technical amendment to reference to section 1395ww of this title involving underlying provisions of original Act. Subsec. (e). Pub. L. 100–360, § 411(k)(6)(A)(vii), as amended by Pub. L. 100–485, § 608(d)(26)(B), (C), designated existing provisions as par. (1), inserted “based on a pooling arrangement involving a majority of the hospitals participating under the plan” after first reference to “payment adjustments”, added par. (2) and substituted “statewide” for “Statewide” in par. (2). ### Statutory Notes and Related Subsidiaries ### Effective Date of 2026 Amendment Pub. L. 119–75, div. J, title I, § 6106(b), Feb. 3, 2026, 140 Stat. 644, provided that: In general.—Except as provided in paragraph (2), the amendments made by this section [amending this section] shall apply to payment adjustments made under section 1923 of the Social Security Act (42 U.S.C. 1396r–4) for Medicaid State plan rate years beginning on or after the date of enactment of this Act [Feb. 3, 2026].State option to distribute unspent DSH allotments from prior years up to modified cap.— In general.—If, for any Medicaid State plan rate year that begins on or after October 1, 2022, and before the date of enactment of this Act, a State did not spend the full amount of its Federal fiscal year allotment under section 1923 of the Social Security Act (42 U.S.C. 1396r–4) applicable to that State plan rate year, the State may use the unspent portion of such allotment to increase the amount of any payment adjustment made to a hospital for such rate year, provided that— such payment adjustment (as so increased) is consistent with subsection (g) of such section (as amended by this section); and the total amount of all payment adjustments for the State plan rate year (as so increased) does not exceed the disproportionate share hospital allotment for the State and applicable Federal fiscal year under subsection (f) of such section. No recoupment of payments already made to hospitals.—A State shall not recoup any payment adjustment made by the State to a hospital for a Medicaid State plan rate year described in subparagraph (A) if such payment adjustment is consistent with section 1923(g) of such Act (42 U.S.C. 1396r–4(g)) as in effect on October 1, 2021.Authority to permit retroactive modification of State plan amendments to allow for increases.— In general.—Subject to clause (ii), solely for the purpose of allowing a State to increase the amount of a payment adjustment to a hospital for a Medicaid State plan rate year described in subparagraph (A) pursuant to this paragraph, a State may retroactively modify a provision of the Medicaid State plan, a waiver of such plan, or a State plan amendment that relates to such rate year and the Secretary may approve such modification. Deadline.—A State may not submit a request for approval of a retroactive modification to a provision of the Medicaid State plan, a waiver of such plan, or a State plan amendment for a Medicaid State plan rate year after the date by which the State is required to submit the independent certified audit for such State plan rate year as required under section 1923(j)(2) of the Social Security Act (42 U.S.C. 1396r–4(j)(2)). Reporting.—If a State increases a payment adjustment made to a hospital for a Medicaid State plan rate year pursuant to this paragraph, the State shall include information in such form and manner as the Secretary shall specify on such increased payment adjustment as part of the annual report submitted by the State under section 1923(j)(1) of the Social Security Act (42 U.S.C. 1396r–4(j)(1)) for such State plan rate year or, if necessary, as determined by the Secretary, in an amendment to such annual report.” ### Effective Date of 2021 Amendment Pub. L. 117–7, § 2(b), Apr. 14, 2021, 135 Stat. 252, provided that the amendment made by section 2(b) is effective as if included in the enactment of section 203(a) of title II of division CC of Public Law 116–260. Pub. L. 117–2, title IX, § 9819(b), Mar. 11, 2021, 135 Stat. 218, provided that: “The amendment made by subsection (a) [amending this section] shall take effect and apply as if included in the enactment of the Families First Coronavirus Response Act (Public Law 116–127).” ### Effective Date of 2020 Amendment Pub. L. 116–260, div. CC, title II, § 203(b), Dec. 27, 2020, 134 Stat. 2979, provided that: “The amendment made by this section [amending this section] shall take effect on October 1, 2021, and shall apply to payment adjustments made under section 1923 of the Social Security Act (42 U.S.C. 1396r–4) during fiscal years beginning on or after such date.” ### Effective Date of 2013 Amendment Pub. L. 113–67, div. B, title II, § 1204(b), Dec. 26, 2013, 127 Stat. 1199, provided that: “The amendments made by subsection (a) [amending this section] shall be effective as of October 1, 2013.” ### Effective Date of 2010 Amendment Pub. L. 111–148, title II, § 2551(b), Mar. 23, 2010, 124 Stat. 314, which provided that the amendments made by subsection (a), amending this section, were effective on Oct. 1, 2011, was repealed by Pub. L. 111–148, title X, § 10201(f), Mar. 23, 2010, 124 Stat. 922. ### Effective Date of 2009 Amendment Amendment by Pub. L. 111–3 effective Apr. 1, 2009, and applicable to child health assistance and medical assistance provided on or after that date, with certain exceptions, see section 3 of Pub. L. 111–3, set out as an Effective Date note under section 1396 of this title. ### Effective Date of 2006 Amendment Pub. L. 109–171, title VI, § 6054(b), Feb. 8, 2006, 120 Stat. 96, provided that: “The amendments made by subsection (a) [amending this section] shall take effect as if enacted on October 1, 2005, and shall only apply to disproportionate share hospital adjustment expenditures applicable to fiscal year 2006 and subsequent fiscal years made on or after that date.” ### Effective Date of 2000 Amendment Pub. L. 106–554, § 1(a)(6) [title VII, § 701(a)(3)], Dec. 21, 2000, 114 Stat. 2763, 2763A–570, provided that: “The amendments made by paragraphs (1) and (2) [amending this section] take effect on the date the final regulation required under section 705(a) [114 Stat. 2763A–575] (relating to the application of an aggregate upper payment limit test for State medicaid spending for inpatient hospital services, outpatient hospital services, nursing facility services, intermediate care facility services for the mentally retarded, and clinic services provided by government facilities that are not State-owned or operated facilities) is published in the Federal Register.” [The final regulation was published Jan. 12, 2001, 66 Fed. Reg. 3147.] Pub. L. 106–554, § 1(a)(6) [title VII, § 701(b)(3)(B)], Dec. 21, 2000, 114 Stat. 2763, 2763A–571, provided that: “The amendments made by paragraph (2) [amending this section] shall apply to payments made on or after January 1, 2001.” ### Effective Date of 1999 Amendment Pub. L. 106–113, div. B, § 1000(a)(6) [title VI, § 601(b)], Nov. 29, 1999, 113 Stat. 1536, 1501A–394, provided that: “The amendments made by subsection (a) [amending this section] take effect on October 1, 1999, and applies [sic] to expenditures made on or after such date.” Amendment by section 1000(a)(6) [title VI, § 608(s)] of Pub. L. 106–113 effective Nov. 29, 1999, see section 1000(a)(6) [title VI, § 608(bb)] of Pub. L. 106–113, set out as a note under section 1396a of this title. ### Effective Date of 1997 Amendment Amendment by section 4711(c)(2) of Pub. L. 105–33 effective Aug. 5, 1997, and applicable to payment for items and services furnished on or after Oct. 1, 1997, see section 4711(d) of Pub. L. 105–33, set out as a note under 1396a of this title. Pub. L. 105–33, title IV, § 4721(a)(2), Aug. 5, 1997, 111 Stat. 512, provided that: “The amendment made by paragraph (1) [amending this section] shall apply to payment adjustments attributable to DSH allotments for fiscal years beginning with fiscal year 1998.” ### Effective Date of 1993 Amendment Pub. L. 103–66, title XIII, § 13621(a)(2), Aug. 10, 1993, 107 Stat. 629, provided that: “The amendments made by this subsection [amending this section] shall apply to payments to States under section 1903(a) of the Social Security Act [42 U.S.C. 1396b(a)] for payments to hospitals made under State plans after— the end of the State fiscal year that ends during 1994, or in the case of a State with a State legislature which is not scheduled to have a regular legislative session in 1994, the end of the State fiscal year that ends during 1995;without regard to whether or not final regulations to carry out such amendments have been promulgated by either such date.” Pub. L. 103–66, title XIII, § 13621(b)(3), Aug. 10, 1993, 107 Stat. 631, provided that: In general.—Except as provided in subparagraph (B), the amendments made by this subsection [amending this section] shall apply to payments to States under section 1903(a) of the Social Security Act [42 U.S.C. 1396b(a)] for payments to hospitals made under State plans after— the end of the State fiscal year that ends during 1994, or in the case of a State with a State legislature which is not scheduled to have a regular legislative session in 1994, the end of the State fiscal year that ends during 1995;without regard to whether or not final regulations to carry out such amendments have been promulgated by either such date. Delay in implementation for private hospitals.—With respect to a hospital that is not owned or operated by a State (or by an instrumentality or a unit of government within a State), the amendments made by this subsection shall apply to payments to States under section 1903(a) for payments to hospitals made under State plans for State fiscal years that begin during or after 1995, without regard to whether or not final regulations to carry out such amendments have been promulgated by such date.” ### Effective Date of 1991 Amendment Amendments by Pub. L. 102–234 effective Jan. 1, 1992, see section 3(e)(1) of Pub. L. 102–234, set out as a note under section 1396a of this title. ### Effective Date of 1990 Amendment Pub. L. 101–508, title IV, § 4702(b), Nov. 5, 1990, 104 Stat. 1388–171, provided that: “The amendment made by subsection (a) [amending this section] shall take effect on July 1, 1990.” Pub. L. 101–508, title IV, § 4703(d), Nov. 5, 1990, 104 Stat. 1388–171, provided that: “The amendments made by this section [amending this section] shall take effect as if included in the enactment of section 412(a)(2)[4112(a)(2)] of the Omnibus Budget Reconciliation Act of 1987 [Pub. L. 100–203, enacting this section].” ### Effective Date of 1988 Amendment Amendment by Pub. L. 100–485 effective as if included in the enactment of the Medicare Catastrophic Coverage Act of 1988, Pub. L. 100–360, see section 608(g)(1) of Pub. L. 100–485, set out as a note under section 704 of this title. Amendment by section 302(b)(2) of Pub. L. 100–360 effective July 1, 1988, see section 302(f)(2) of Pub. L. 100–360, set out as a note under section 1396a of this title. Except as specifically provided in section 411 of Pub. L. 100–360, amendment by section 411(k)(6)(A)–(B)(ix) of Pub. L. 100–360, as it relates to a provision in the Omnibus Budget Reconciliation Act of 1987, Pub. L. 100–203, effective as if included in the enactment of that provision in Pub. L. 100–203, see section 411(a) of Pub. L. 100–360, set out as a Reference to OBRA; Effective Date note under section 106 of Title 1, General Provisions. ### Application of Medicaid DSH Transition Rule to Public Hospitals in All States Pub. L. 106–554, § 1(a)(6) [title VII, § 701(c)], Dec. 21, 2000, 114 Stat. 2763, 2763A–571, provided that: In general.—During the period described in paragraph (3), with respect to a State, section 4721(e) of the Balanced Budget Act of 1997 (Public Law 105–33; 111 Stat. 514) [set out as a note below], as amended by section 607 of BBRA [Pub. L. 106–113, § 1000(a)(6) [title VI, § 607(a)]] (113 Stat. 1501A–396), shall be applied as though— ‘September 30, 2002’ were substituted for ‘July 1, 1997’ each place it appears; ‘hospitals owned or operated by a State (as defined for purposes of title XIX of such Act [42 U.S.C. 1396 et seq.]), or by an instrumentality or a unit of government within a State (as so defined)’ were substituted for ‘the State of California’; paragraph (3) were redesignated as paragraph (4); ‘and’ were omitted from the end of paragraph (2); and the following new paragraph were inserted after paragraph (2): ‘(3) “(as defined in subparagraph (B) but without regard to clause (ii) of that subparagraph and subject to subsection (d))” were substituted for “(as defined in subparagraph (B))” in subparagraph (A) of such section; and’. “(2) Special rule.—With respect to California, section 4721(e) of the Balanced Budget Act of 1997 (Public Law 105–33; 111 Stat. 514), as so amended, shall be applied without regard to paragraph (1). “(3) Period described.—The period described in this paragraph is the period that begins, with respect to a State, on the first day of the first State fiscal year that begins after September 30, 2002, and ends on the last day of the succeeding State fiscal year. “(4) Application to waivers.—With respect to a State operating under a waiver of the requirements of title XIX of the Social Security Act (42 U.S.C. 1396 et seq.) under section 1115 of such Act (42 U.S.C. 1315), the amount by which any payment adjustment made by the State under title XIX of such Act (42 U.S.C. 1396 et seq.), after the application of section 4721(e) of the Balanced Budget Act of 1997 under paragraph (1) to such State, exceeds the costs of furnishing hospital services provided by hospitals described in such section shall be fully reflected as an increase in the baseline expenditure limit for such waiver.” ### Assistance for Certain Public Hospitals Pub. L. 106–554, § 1(a)(6) [title VII, § 701(d)], Dec. 21, 2000, 114 Stat. 2763, 2763A–571, provided that: In general.—Beginning with fiscal year 2002, notwithstanding section 1923(f) of the Social Security Act (42 U.S.C. 1396r–4(f)) and subject to paragraph (3), with respect to a State, payment adjustments made under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.) to a hospital described in paragraph (2) shall be made without regard to the DSH allotment limitation for the State determined under section 1923(f) of that Act (42 U.S.C. 1396r–4(f)). Hospital described.—A hospital is described in this paragraph if the hospital— is owned or operated by a State (as defined for purposes of title XIX of the Social Security Act [42 U.S.C. 1396 et seq.]), or by an instrumentality or a unit of government within a State (as so defined); as of October 1, 2000— is in existence and operating as a hospital described in subparagraph (A); and is not receiving disproportionate share hospital payments from the State in which it is located under title XIX of such Act [42 U.S.C. 1396 et seq.]; and has a low-income utilization rate (as defined in section 1923(b)(3) of the Social Security Act (42 U.S.C. 1396r–4(b)(3))) in excess of 65 percent.Limitation on expenditures.— In general.—With respect to any fiscal year, the aggregate amount of Federal financial participation that may be provided for payment adjustments described in paragraph (1) for that fiscal year for all States may not exceed the amount described in subparagraph (B) for the fiscal year. Amount described.—The amount described in this subparagraph for a fiscal year is as follows: For fiscal year 2002, $15,000,000. For fiscal year 2003, $176,000,000. For fiscal year 2004, $269,000,000. For fiscal year 2005, $330,000,000. For fiscal year 2006 and each fiscal year thereafter, $375,000,000.” ### DSH Payment Accountability Standards Pub. L. 106–554, § 1(a)(6) [title VII, § 701(e)], Dec. 21, 2000, 114 Stat. 2763, 2763A–572, provided that: “Not later than September 30, 2002, the Secretary of Health and Human Services shall implement accountability standards to ensure that Federal funds provided with respect to disproportionate share hospital adjustments made under section 1923 of the Social Security Act (42 U.S.C. 1396r–4) are used to reimburse States and hospitals eligible for such payment adjustments for providing uncompensated health care to low-income patients and are otherwise made in accordance with the requirements of section 1923 of that Act.” ### DSH Allotments for Specific Years Pub. L. 105–277, div. A, § 101(f) [title VII, § 702], Oct. 21, 1998, 112 Stat. 2681–337, 2681–389, provided that: “The amount of the DSH allotment for the State of Minnesota for fiscal year 1999, specified in the table under section 1923(f)(2) of the Social Security Act [42 U.S.C. 1396r–4(f)(2)] (as amended by section 4721(a)(1) of Public Law 105–33) is deemed to be $33,000,000.” Similar provisions were contained in the following prior appropriations act: Pub. L. 105–78, title VI, § 601, Nov. 13, 1997, 111 Stat. 1519. Pub. L. 105–277, div. A, § 101(f) [title VII, § 703], Oct. 21, 1998, 112 Stat. 2681–337, 2681–389, provided that: “The amount of the DSH allotment for the State of New Mexico for fiscal year 1999, specified in the table under section 1923(f)(2) of the Social Security Act [42 U.S.C. 1396r–4(f)(2)] (as amended by section 4721(a)(1) of Public Law 105–33) is deemed to be $9,000,000.” Pub. L. 105–277, div. A, § 101(f) [title VII, § 704], Oct. 21, 1998, 112 Stat. 2681–337, 2681–389, provided that: “Notwithstanding section 1923(f)(2) of the Social Security Act (42 U.S.C. 1396r–4(f)(2)) (as amended by section 4721(a)(1) of the Balanced Budget Act of 1997 (Public Law 105–33; 111 Stat. 511)[)], the amount of the DSH allotment for Wyoming for fiscal year 1999 is deemed to be $95,000.” Similar provisions were contained in the following prior appropriations act: Pub. L. 105–78, title VI, § 602, Nov. 13, 1997, 111 Stat. 1519. ### California Transition Rule Pub. L. 105–33, title IV, § 4721(e), Aug. 5, 1997, 111 Stat. 514, as amended by Pub. L. 106–113, div. B, § 1000(a)(6) [title VI, § 607(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A–396, applied certain provisions to former subsec. (g)(2) of this section in regards to the State of California. ### Study of DSH Payment Adjustments Pub. L. 102–234, § 3(d), Dec. 12, 1991, 105 Stat. 1803, directed Prospective Payment Assessment Commission to conduct a study concerning feasibility and desirability of establishing maximum and minimum payment adjustments under subsec. (c) of this section for hospitals deemed disproportionate share hospitals under State medicaid plans, and criteria (other than criteria described in clause (i) or (ii) of subsec. (f)(1)(D)) that are appropriate for the designation of disproportionate share hospitals under this section, specified items to be included in study, and directed that, not later than Jan. 1, 1994, Commission submit a report on the study to Committee on Finance of Senate and Committee on Energy and Commerce of House of Representatives, such report to include such recommendations respecting designation of disproportionate share hospitals and the establishment of maximum and minimum payment adjustments for such hospitals under this section as may be appropriate.