Dive Brief:
- At the one-year mark, Maryland's unprecedented move to simultaneously stem healthcare costs and improve quality is drawing attention for its positive results, and prompting talk it could serve as a model to other states.
- Beginning in 2014, Maryland started to limit what hospitals could earn each year through patient revenue.
- With that cap in place, hospitals have had to strive harder to keep patients out of their EDs and inpatient units, while also meeting quality benchmarks to ensure they are improving care as opposed to withholding it.
Dive Insight:
The approach is gaining attention after leading to improved quality measures and Medicare savings of $116 million during its first year.
According to a recent article in the New England Journal of Medicine, improvements included a 26% decrease in infections.
In addition, hospitals promptly began to invest in solutions that would not have been cost-effective under their previous model, such as placing social workers in EDs to get to the root of the problems with frequent visitors and using community-based programs to tackle chronic health issues.
Some health experts suggest similar efforts could be adopted by other states.
“We’ve tried basically everything else,” Robert Murray, president of the management consulting firm Global Health Payment LLC, told the Business Journal. “There’s not much else, as far as policy, that’s worked. States will have no choice but to consider rate-setting like this.”