The Centers for Medicare and Medicaid Services announced that they are expanding their all-payer model in Maryland to include outpatient services, in its first test to keep a state fully at risk for the total cost of care for Medicare beneficiaries .
Maryland’s all-pay model was launched in 2014 and has so far focused on hospitals.
The new total cost of care model released by the CMS Innovation Center will work in much the same way, setting a per capita payment based on population.
CMS said it expects to save $ 1 billion between 2019 and 2023.
The model includes a care redesign program to allow hospitals to make incentive payments to non-hospital health care providers, if the hospital has realized some savings.
CMS encourages primary care providers to offer advanced care services by giving practices an additional payment per beneficiary per month. The agency also offers a performance-based incentive payment to reduce the hospitalization rate.
CMS has targeted six priority areas for population health to improve: substance use disorders, diabetes, hypertension, obesity, smoking, asthma.
The performance period begins on January 1, 2019 and ends on December 31, 2026.
Maryland’s all payers model has delivered significant savings for Medicare and improved quality, according to the third annual assessment released in March.
“Maryland hospitals have been able to operate within their overall budgets without negative effects on their financial situation,” the report said.
They have also been able to reduce expenses without shifting costs to other parts of the health system.
In the first three years, Medicare saved $ 679 million in the all-payer model, a 2.7% reduction in total Medicare spending.
The cuts were driven by reduced spending for outpatient hospital services, according to the report.
The report showed that in the all-payer model, coordination of care with external providers in the community, as measured by follow-up visits after discharge from hospital, did not improve.
Spending for emergency room visits and observations has declined, but the rate of such visits has increased for Medicare beneficiaries and decreased for commercial members.
Inpatient admissions have declined for both Medicare beneficiaries and members of commercial plans.