Maryland’s New All-Payer Model:
What a Revolution Feels Like
Stephen F. Jencks, M.D., M.P.H.
The New All Payer Model
Growth in hospital revenues capped at 3.58% a
year plus population growth.
 Larger savings for Medicare ($330 million over
5 years compared to growth for the rest of the
country).
 Global revenue caps for all hospitals in the
state for almost all hospital programs except
physicians.
 Proposal due in 2017 to extend the model to
all health care costs in Maryland.

2
The Fundamental Theorem
The required savings can be achieved by
 Reducing care that is bad for patients such as
healthcare-acquired conditions, readmissions,
and prevention quality indicator admissions,
and
 Increasing care that is good for patients such
as prevention, effective management of chronic
disease, and care that is responsive to patient
and family preferences.
3
Monthly Risk-Adjusted Readmission
Rates
14.5
All-Payer
Medicare FFS
14.0
All-Payer (Preliminary)
Medicare FFS (Preliminary)
13.5
Linear (All-Payer)
13.0
12.5
12.0
11.5
11.0
Risk Adjusted
Readmission Rate
August 13 YTD
August 14 YTD
Percent Change
All-Payer
Medicare
12.47
12.05
-3.37%
13.19
13.04
-1.16%
New Waiver
Start Date
Note: Based on final data for January 2013 - June 2014 and preliminary data for July -September 2014.
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
Jan-14
Dec-13
Nov-13
Oct-13
Sep-13
Aug-13
Jul-13
Jun-13
May-13
Apr-13
Mar-13
Feb-13
Jan-13
Dec-12
Nov-12
Oct-12
Sep-12
Aug-12
Jul-12
10.5
Monthly Risk-Adjusted PPC Rates
2.00
All-Payer
Medicare FFS
1.80
All-Payer (Preliminary)
1.60
Medicare FFS (Preliminary)
Linear (All-Payer)
1.40
1.20
1.00
0.80
0.60
Risk Adjusted PPC
Rate
Sept. 13 YTD
Sept. 14 YTD
Percent Change
All-Payer
Medicare
1.28
1.00
-22.04%
1.49
1.11
-25.88%
New Waiver
Start Date
0.40
Note: Based on final data for January 2013 - June 2014 and preliminary data for July - September 2014.
HSCRC Core Mission
Core mission is to set rates that allow an
efficient hospital to be profitable and to assure
that the services justify the rates – that is, are
of adequate quality.
 Uses an advisory council and workgroups to
help it find the best ways.
 HSCRC has responsibility and statutory
authority to make this model work financially.

6
Limits of the Core Mission

HSCRC does not have the statutory authority
to require some activities that are vital to
clinical success of the new all-payer model.




Alignment of physician and hospital incentives
Coordination of care among providers
Use of patient-owned care plans
In these areas HSCRC can only succeed by
working with stakeholders and State agencies
as a convener, catalyst, and partner.
7
HSCRC Partnerships

Care Coordination: Support short- and long-term
strategies to integrate care for the most vulnerable and
for all patients.

Clinical Improvement: Support selected strategies
for reducing useless/hazardous services.

Consumer Voice: Support consumer engagement
and skill development

Physician Participation: Support implementation of
physician alignment/engagement models
8
Organization for Planning: Phase 2
Advisory
Council
HSCRC
Commissioners & Staff
HSCRC FUNCTIONS
Payment
Payment Models
Workgroup
9
Performance
Improvement
Measurement
Workgroup
PARTNERSHIP ACTIVITIES
Multi-Agency and Stakeholder Groups
Care
Coordination
Workgroup
Consumer
Engagement,
Outreach &
Education
Workgroup
Alignment
Models
Workgroup
End