Reporting Requirements for Annual Financial Reports of State Agencies and Universities
Disproportionate Share Program
The Disproportionate Share Program (DSP) is a Medicaid policy requiring states to consider the special needs of hospitals that serve disproportionate numbers of Medicaid or indigent patients when setting Medicaid payment rates. All DSP payments earn federal matching funds. When reporting DSP payments:
- Actual federal funds received and disbursed are reported as revenues and expenditures.
- All other disproportionate share transactions are reported as transfers from the state agency distributing the DSP funds (usually Agency 529 – Health and Human Services Commission).