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Yahoo
08-05-2025
- Health
- Yahoo
Bumps AHEAD: Trump administration evaluating Maryland's authority to set Medicare rates
A look at Western Maryland Hospital Center in Washington County. (File photo by Hannah Gaskill/Maryland Matters) The Trump administration has signaled an interest in reining in Maryland's ability to set rates for Medicare services – an authority the state has held for about 40 years. Maryland's system, unusual among states, gives the state significant say over the costs of health care services across different coverage plans to keep costs low and consistent, in what's known as the States Advancing All-Payer Health Equity Approaches and Development, or AHEAD, model. But advocates worry that the feds' apparent interest in changing who sets Medicare rates could disrupt health care payments for consumers, governments and providers. Senate President Bill Ferguson (D-Baltimore City) told reporters this week that he was 'cautiously concerned' about the future of Maryland's health care system while those negotiations continue between federal and state health officials. 'I don't want to over-index anything … There's reason to be concerned that there are going to be substantial changes,' he said. The state's ability to set Medicare rates has been in place for about 40 years under a waiver granted by the Centers for Medicare and Medicaid Innovation (CMMI). In the time since, the state's health care system has evolved and the Maryland Health Services Cost Review Commission now determines the rates for care across all hospitals in the state, so that health care service costs are similar whether someone has private insurance, Medicare or Medicaid. But the current iteration of that payment system, called Total Cost of Care, is set to end in December 2025. Last November, Maryland entered into an agreement with the Biden administration to continue under the similar AHEAD system. The AHEAD model was actually based on Maryland's Total Cost of Care model and similar systems in other states, due to its success in reducing health care costs. But the Trump administration is now talking about taking another look at that arrangement and possibly making some changes. Specifically, federal officials are interested in removing Maryland's ability to set rates for Medicare services While current talks focus on Medicare rates, there could be ripple effects on rates for Medicaid and private insurance due to the state's all-payer model that aims to keep costs for health care consistent across the board, according to health care advocates. Centers for Medicare and Medicaid Services, which oversees CMMI, did not confirm whether the Trump administration plans to end Maryland's rate-setting authority for Medicare, but reiterated that 'subject to discussions with State authorities,' the AHEAD model is currently set to begin in January 2026. Maryland Health Secretary Dr. Meena Seshamani, a former CMS official in the Biden administration, said that those discussions are ongoing. 'Since the change in federal administration, the Maryland Department of Health has been in direct discussions about the future of the model, working with CMMI and in-state stakeholders to align the Maryland model with federal priorities to deliver high-quality outcomes for all Marylanders,' Seshamani said Wednesday. 'The administration will not comment further, given that discussions are ongoing and confidential.' There may be opportunities where CMMI and the state can find common ground over shared goals like preventing and reducing chronic disease, experts say, though it is unclear where negotiations will land at this moment. Gene Ransom, CEO for MedChi, the Maryland State Medical Society, believes it is not time to panic, and that there is still opportunity for the state and the Trump administration to 'meet in the middle' — even if CMMI officials signal interest in changing the rate-setting process for Medicare. And despite his 'cautious concern,' Ferguson said he hopes that any changes that come down on the state's current health care plan will still help lower health care costs for Marylanders while pushing for greater quality of care. 'There could be changes that don't have a dramatic impact on the financial stability of our marketplace for health care,' he said. 'I am hopeful that those in charge of CMS and CMMI will see the benefit that the Maryland model has provided for lowering costs over time,' he said, noting that there may be 'important updates' in the next few weeks.
Yahoo
13-03-2025
- Health
- Yahoo
Caution AHEAD: State officials nervous for Maryland hospitals under Trump administration
The Trump administration announced Wednesday that it will be ending Maryland's unique hospital-rate setting program at the end of the year, a change that was not unexpected but that still has state officials on edge nonetheless. (Photo by Danielle Brown/Maryland Matters) The Trump administration announced Wednesday that it will be ending Maryland's unique hospital-rate setting program at the end of the year, a change that was not unexpected but that still has state officials on edge nonetheless. State health officials had planned to wind down the current Total Cost of Care program to transition into a new federal version of the program at the start of 2026. But amid a deluge of rapid federal decisions, the notice has legislative leadership nervous that Maryland's hospital system, which relies on federal funding to operate, could be at risk under the Trump administration. 'Unlike any other state – that (funding) upholds our entire hospital system across the state of Maryland. It's in jeopardy,' Senate President Bill Ferguson (D-Baltimore City) said in testimony Wednesday to the Budget and Taxation Committee. His remarks were sparked by a statement from the Centers for Medicare and Medicaid Services Wednesday, announcing that the agency's Innovation Center plans to test, and then scale up, 'innovation payment models' that reduce spending while improving quality of care. Maryland's Total Cost of Care model, which sets hospital rates in the state, was one of the programs targeted by CMS to end in December while moving forward with the state's transition into the Advancing All-Payer Health Equity Approaches and Development — or AHEAD — model, which is a federal version of Maryland's system. Gene Ransom, CEO for MedChi, The Maryland State Medical Society, noted that the timeline for Maryland's plan to end the state system and transition into the federal plan has not actually changed, despite the agency's claim that it has decided to end the state program early. GOP tax cut plans may depend on savings from Medicaid. What is it and who relies on it? CM, 'We expected Total Cost of Care to end. That's why we entered into the agreement as a state to go to AHEAD,' Ransom said. He said the state should continue to work with federal officials to keep the transition going forward, but notes that the Trump administration could be setting new expectations for what the AHEAD model will look like when it does take effect. 'It's one of those things that, as change occurs, it could be very nerve-wracking,' Ransom said. 'We need to all pay attention to the details and try to do everything we can to protect the interesting system that we built in Maryland.' Under the current model, a state board sets annual hospital payments in advance, but includes patient outcome goals — reducing readmissions, for example — as incentives. The state's model sets a 'global budget' for hospitals across the state, which is the total amount of revenue each hospital can earn in a year. The goal is lower cost burdens on patients and improving quality of care while disincentivizing profit-based motives. In 2023, the Biden administration announced the creation of the AHEAD model, which takes a cue from Maryland and other states with similar systems by helping states transition into a Total Cost of Care model. Maryland officials were informed that they would need to join the AHEAD model in order to keep some of the funding and program flexibility currently available to the state under Total Cost of Care. On Nov. 1, Gov. Wes Moore celebrated an agreement signed between CMS and the state to begin the transition officially with an 18-month transition process, with the state's Total Cost of Care model ending in December 2025 and the changeover finishing by January 2026. But under the Trump Administration, CMS said it was cutting certain programs 'early' to save money. The announcement also targets two primary care programs and a program to encourage more home dialysis as well as kidney transplants for people with end-stage renal disease. They would be closed by the end of the year. CMS estimates that cutting these programs early, including Maryland's Total Cost of Care program, will yield $750 million in savings nationwide. 'The CMS Innovation Center will continue providing transparency about important changes to advance its mission to lower costs and improve quality of care,' the statement said. 'The Center looks forward to sharing information about next steps, including its new strategic vision, modifications to models to improve their potential for certification and expansion and new models that empower Americans to live healthier lives while protecting taxpayers.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
