In 2011, Texas Health & Human Services Commission (HHSC) received legislative approval to apply for and accept a five-year project as allowed under Section 1115 of the Social Security Act. The "Transformation & Quality Improvement Program" (aka 1115 Waiver) allows Texas to expand the existing Medicaid managed care programs, and to establish two funding pools that will assist providers with uncompensated care costs, and promote health system transformation. The 1115 Waiver redirects the supplemental payments that historically existed under the Upper Payment Limit (UPL) program in order to improve care delivery systems and capacity, while emphasizing accountability and transparency, and requiring demonstrated improvements as the provider level for the receipt of funding. These two pools of funding are Uncompensated Care (UC) and Delivery System Reform Incentive Payment Program (DSRIP). In 2016, the waiver was extended for a sixth year at level funding. Negotiations are ongoing for continuation beyond Demonstration Year 6.
The 1115 Waiver's benefits include: