A July study by the Government Accountability Office (GAO) found that states reported $32 billion in Medicaid supplemental payments during 2010. Supplemental payments include Disproportionate Share Hospital (DSH) payments, which offset the uncompensated costs of care provided to Medicaid beneficiaries and individuals without insurance. DSH payments totaled $17.6 billion, while non-DSH supplemental payments totaled $14.4 billion. The latter figure is a more than $8 billion increase from 2006, which is the last year the GAO reported on. The bulk of the increase was for inpatient hospital services.
The study was initiated due to ongoing concern about the transparency of states' Medicaid supplemental payment reporting. CMS officials told the GAO that they were working to improve states' reporting of non-DSH supplemental payments, including assisting in better staff training and identifying and resolving reporting problems.