The Centers for Medicare and Medicaid Services is extending Maryland’s All-Payer Medicare Model Contract for hospitals for another year. Maryland Gov. Larry Hogan (R) and CMS announced this week the program will go through 2019.
Started in 2014, the program regulates what hospitals can charge to have CMS pay for a larger share of Medicare costs. The idea behind the program is to have all insurers — public and private — pay a similar amount for services.
Maryland is seeking approval for a larger proposal that includes outpatient services for 10 years. Hogan told The Washington Post that his state was close to an agreement before HHS Secretary Tom Price resigned in the fall.
The CMS agreed to approve the one-year extension to allow the agency to complete its review of the program before financing a new all-payer contract.
The contract is a Medicare per capita savings model that’s designed to coordinate care for patients, improve health outcomes and reduce healthcare costs. “The model also enables the state and provider communities to collaborate on critical healthcare issues, including opioid use, diabetes, hypertension and other chronic conditions. This approach draws upon a strong partnership with key players in Maryland’s health system – hospitals, payers, physicians, long-term care providers and regulatory agencies, along with state and federal partners,” according to a state of Maryland press release.
Hogan’s office said the model has led to reduced unnecessary readmissions and hospital-acquired conditions and decreased the growth of hospital cost per capita, but the CMS asked that it be expanded.
“The current approach focused on hospitals does not sufficiently provide for comprehensive coordination across the entire healthcare system. Because of this limitation, the federal government required Maryland to develop a new model that encompasses all of the healthcare that patients receive, both inside the hospital and the community,” according to the governor’s office.
Hospitals are watching what happens with the all-payer project closely. Maryland has found success, but we’ll have to wait for a larger CMS review and whether the agency agrees to extend and expand the contract further.