www.baltimoresun.com/health/blog/bs-bz-medicare-waiver-submitted-20131011,0,2979140.story

baltimoresun.com

Md. submits plan to overhaul hospital charges

Revised system would tie reimbursements to state's economy rather than admissions

By Scott Dance, The Baltimore Sun

3:10 PM EDT, October 11, 2013

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Maryland health officials on Friday turned over to the federal government a plan that would overhaul how hospitals are paid for treating patients to promote lower admissions and better care.

The state Department of Health and Mental Hygiene plan would replace a model in which hospitals are reimbursed for care based on numbers of hospital admissions with one that instead ties that spending to the state economy.

The plan would allow the state to preserve a unique setup in which Maryland officials set generally uniform rates for hospital charges. In other states, hospitals negotiate their own rates with insurers while the federal Medicare program sets rates for care of its patients, the elderly and disabled.

A waiver granted by the Centers for Medicare and Medicaid Services allows Maryland's rate-setting structure but had been at risk because of rising costs of care.

The proposal has the support of the Maryland Hospital Association, the state's largest insurer CareFirst BlueCross BlueShield, and other health care and consumer groups, state officials said.

The plan had been unveiled Sept. 27 and was then subject to a public comment period that ended Monday. No significant changes were made after that period, officials said.

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