A unique agreement Maryland made with federal regulators that affects how much everyone in the state pays for medical care, and how they get that care in the hospital or a doctor’s office, has been extended through 2026.
The program aims not only to contain overall health care spending but also to improve health outcomes by ensuring patients’ chronic conditions are managed and they avoid unnecessary hospital stays.
The primary care doctor portion of the model was added to the long-standing hospital part in 2019, and both programs are an agreement between Maryland and the U.S. Center for Medicare and Medicaid Innovation.
Under the hospital portion, hospital rates are set and all public and private insurers and self-paying patients pay the same for services, and those payments are tied to the Medicare rate. Medicare pays higher rates in Maryland than elsewhere in exchange for the state’s medical providers keeping the overall cost of health care under the national average and keeping patients as a whole healthier and out of the hospital.
Under the doctor portion of the payment system, primary care practices, including federally qualified health centers, are given extra funds and technical support to better coordinate the preventive care given to patients. This program is voluntary, but 508 primary care practices and more than 2,150 providers are now participating, according to the Maryland Department of Health. That accounts for more than 4 million Maryland patients.
The renewed agreement also comes with some new provisions to hold the practices more financially accountable and to increase payments to help disadvantaged residents. Those payments can be used for health-related support or access to food and nutrition care-management services, among other needs.
“The continuation and expansion of [the primary care program] means more Marylanders will have access to comprehensive primary care,” Maryland Health Secretary Dennis R. Schrader said in a statement. “The amendment also means more support to primary care providers to bolster the state’s efforts to address health equity, including funding to address the social needs of ... beneficiaries.”
The extension of the program is supported by the state’s medical society, MedChi, and the Maryland Hospital Association.
Overall, the programs are expected to save Medicare $336 million in 2024, $372 million in 2025 and $408 million in 2026.