The All-Payer Model: Maryland’s Secret Weapon to Right Healthcare Costs

Nearly everyone has heard from the political left and progressives for plans to create a single-payer healthcare system, Medicare for all, or Medicare-optional programs. However, even many well-informed people don’t know about Maryland’s strategy to fight out of control healthcare costs: the all-payer model. This model, in place for nearly forty years, exempts the state from the Inpatient Prospective Payment System (IPPS) and Outpatient Prospective Payment System (OPPS) and allows Maryland to set rates for these services for Medicare, Medicaid, and Children's Health Insurance Program (CHIP) recipients. As part of an agreement with the national Center for Medicare & Medicaid Services (CMS), Maryland must limit inpatient and outpatient hospital per capita growth to 3.58 percent and save $330 million in Medicare costs over a five-year period. Additionally, they must meet several quality measures: matching national Medicare 30-day readmissions rates, reduce potentially preventable complications by 30 percent over five years, and submit annual reports on population health measures. [1]

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