Maryland health administrators unveiled a plan to adjust hospital reimbursements and cost metrics in order to keep its unique full-payment arrangement with Medicare, according to a report by the Washington Post.
In the 49 other states, Medicare pays a federally standardized discount rate to providers. But since 1977, Maryland has been allowed to set reimbursement rates for Medicare as long as it keeps its cumulative spending growth below national payments. That's worked out fine so far, but now that federal healthcare spending growth is at a three-year plateau, the state is projected to barely fall under that threshold by less than 2 percent this year.
Losing the so-called Medicare waiver would cost the state an estimated $1 billion, according to the report.
The plan Maryland's health secretary and health insurance review commissioner presented before lawmakers to remedy that shrinking margin would tie hospital payments to growth in the state's economy and institute a shared savings model among providers, according to the report. The plan would extend current contracts two months past the original expiration date of April 30 to give the industry time to prepare.
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In the 49 other states, Medicare pays a federally standardized discount rate to providers. But since 1977, Maryland has been allowed to set reimbursement rates for Medicare as long as it keeps its cumulative spending growth below national payments. That's worked out fine so far, but now that federal healthcare spending growth is at a three-year plateau, the state is projected to barely fall under that threshold by less than 2 percent this year.
Losing the so-called Medicare waiver would cost the state an estimated $1 billion, according to the report.
The plan Maryland's health secretary and health insurance review commissioner presented before lawmakers to remedy that shrinking margin would tie hospital payments to growth in the state's economy and institute a shared savings model among providers, according to the report. The plan would extend current contracts two months past the original expiration date of April 30 to give the industry time to prepare.
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