On December 15, 2017, CMS notified state Medicaid directors that it will no longer accept state 1115 demonstration proposals that rely on funding for “Designated State Health Programs” (DSHP). While the agency acknowledged that federal DSHP funds were intended to support state delivery reform efforts, the letter argued that states were not in fact contributing to these reforms and instead relying on these freed up dollars to draw down additional Medicaid matching funds.