Maryland Moves Forward With Bold Hospital Spending Plan

Some say the deal will eventually change the way hospitals in all the states are paid for delivering health care and could become a national model for controlling health care costs.

Kaiser Health News: Maryland's Bold Hospital Spending Plan Gets Federal Blessing
Maryland officials have reached what analysts say is an unprecedented deal to limit medical spending and abandon decades of expensively paying hospitals for each extra procedure they perform. If the plan works, Maryland hospitals will be financially rewarded for keeping people out of the hospital -- a once unimaginable arrangement (Hancock, 1/10).

The Washington Post: Maryland's Plan To Upend Health Care Spending
The Obama administration is set to announce Friday an ambitious health-care experiment that will make Maryland a test case for whether aggressive government regulation of medical prices can dramatically cut health spending. Under the experiment, Maryland will cap hospital spending and set prices -- and, if all goes as planned, cut $330 million in federal spending. The new plan, which has been under negotiation for more than a year, could leave Maryland looking more like Germany and Switzerland, which aggressively regulate prices, than its neighboring states. And it could serve as a model -- or cautionary tale -- for other states looking to follow in its footsteps (Kliff, 1/10).

The Associated Press: Maryland Changes Unique Hospital Rate System
The state of Maryland is announcing a new initiative with the federal government to modernize the state's unique rate-setting system for hospital services. The agreement, which will be officially announced Friday by state and federal officials, is designed to move Maryland away from reimbursing hospitals on a fee-for-service basis to an emphasis on prevention and quality of care. Under the new plan, hospitals will do better financially as they provide high-quality care and help keep communities healthier, rather than being rewarded solely on the number of patients they treat, Dr. Joshua Sharfstein, Maryland's health secretary, said (Witte, 1/10).

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