Maryland’s Evolving Approach to Hospital Payment
Maryland has been a national leader in hospital payment reform.
From January 1, 2014, through December 31, 2018, the Maryland All-Payer Medicare Model focused on improving quality, enhancing health outcomes, and controlling Medicare spending for hospital inpatient and outpatient services. During this period, hospitals successfully reduced unnecessary readmissions and hospital-acquired conditions while slowing growth in hospital costs per capita.
However, the All-Payer Model primarily targeted hospitals and did not fully support coordinated care across the broader health care system. To address this gap, Maryland worked with the federal government to develop a new approach that extended beyond hospitals to include all care patients received—both in the hospital and in the community.
Total Cost of Care Model Overview
On July 9, 2018, Maryland and the federal government signed the TCOC Model State Agreement, which became effective January 1, 2019, and ran through December 2025. Under the TCOC Model, Maryland was expected to transform care delivery across the health system, improve health and quality of care, and maintain Medicare spending growth below the national rate.
The TCOC Model gave Maryland the flexibility to tailor initiatives to the state’s unique health care environment and encouraged innovation among providers. It supported investments in
population health improvement,
care redesign and provided new tools and resources for
primary care providers to better manage complex and chronic conditions, helping Marylanders achieve better health.
Read a summary on the background of the TCOC Model.
Maryland achieved significant savings, quality improvements, and care transformation progress under the TCOC Model. Updates on Maryland's performance, including annual performance against Model tests and formal evaluation studies conducted on behalf of CMS, are posted in the Key Documents below.
