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Final Report: Maryland All-Payer Model Reduced Medicare Expenditures by $975 Million

December 03, 2019

McDermott+Consulting

The Center for Medicare and Medicaid Innovation (CMMI) posted the final evaluation report for the Maryland All-Payer Model. The model reduced total expenditures across payers and total hospital expenditures for Medicare beneficiaries without shifting costs to other parts of the health care system. The $975 million in savings for Medicare beneficiaries relative to the comparison group was found to be largely driven by reductions in spending for outpatient hospital services. While it was found that commercial payers had 6.1% slower growth relative to the comparison group, growth in total expenditures did not slow among commercial plan members.

Established in 2014, the All-Payer Model exempted Maryland hospitals from both inpatient and outpatient prospective payment systems and established universal payment rates across payers. The goal of this model was to test whether a statewide rate-setting system was effective at reducing costs and improving access and quality. To assess whether the model effectively reduced costs, CMMI measured expenditures across payers to a comparison group similar to Maryland in hospital and county characteristics. All regulated acute care hospitals in Maryland and all patients hospitalized at Maryland hospitals participated in this model.

A high level summary of the final evaluation report can be found here. Additional information on the Maryland all-Payer Model can be found on the CMMI model website.

 

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For more information visit the McDermottPlus Payment Innovation Resource Center or contact Mara McDermott at 202-204-1462 or mmcdermott@mcdermottplus.com.

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