In December 2011, the Texas Health and Human Services Commission (HHSC) received federal approval of a demonstration waiver under Medicaid section 1115(a), titled “ Texas Healthcare Transformation and Quality Improvement Program,” for the period December 12, 2011 through September 20, 2016. The primary goal of the 1115 waiver is to improve access to and quality of health care by expanding the Medicaid and managed care programs promoting health care delivery system reforms while containing cost growth. Specifically, the Waiver created two new funding pools: Uncompensated Care (UC) and Delivery System Redesign and Innovation Payment (DSRIP), redirecting funding. funds that were available under the old Upper Payment Limit (UPL) payment methodology DSRIP funding is used to offer financial incentives to health care providers who develop and implement projects aimed at improving how care is provided to low-income populations. . Specifically, providers (often referred to as “performing providers” or “implementers”) propose and execute projects such as programs, strategies and investments designed to improve access to healthcare, quality of healthcare, cost-effectiveness and effectiveness of services and health of patients and families assisted. Based on the completion of project milestones, they receive DSRIP payments. Milestones are project objectives, made up of metrics that indicate their progress, and suppliers must reach the milestones in order to apply for the associated incentive funds. DSRIP projects last five demonstration years, DY1 through DY5. Additionally, each demonstration year has distinct milestones, metrics and incentive funds. If suppliers fail to reach certain milestones, the bottom... middle of the paper... h results domain and suppliers choose the ones they want to focus on that will best reflect the success of their projects. For each of these DSRIP activities, providers must also select the appropriate milestone and metric options from the DSRIP menu. In addition to receiving payments for completing milestones associated with Category 1 and 2 projects, vendors receive separate incentive payments for completing milestones associated with Category 3. Category 4 requires all hospital vendors to use the same reporting measures. For example, providers must report data related to hospitalizations, readmissions and potentially preventable complications, patient-centered healthcare, and emergency room utilization. Hospitals exempt from Category 4 requirements under Sections 11.e of the PFM Protocol. and 11.f are not required to report on such measures.