Maryland’s Total Cost of Care Model

​​TCOC Model Overview​

Improving Marylanders’ Health and Quality of Life

The State of Maryland is committed to ensuring that all Marylanders have access to the nation’s best health care and that our critical health needs are met.  Our priorities:

●       Ensure that all Marylanders have access to quality health care by the nation’s best health care providers in every corner of the state – whether rural or urban.

●       Address the needs of our senior population, which is expected to increase by 40% over the next ten years.

●       Fight the opioid epidemic and other population health improvements such as diabetes prevention and other chronic conditions.

Addressing Health System Limitations

Maryland’s most recent approach to hospital payment was known as the “Maryland All-Payer Medicare Model Contract,” and ran from January 1, 2014 through December 31, 2018.  The All-Payer Model’s success metrics were based on enhancing quality, improving health outcomes, and constraining the growth of Medicare costs for hospital inpatient and outpatient services. 

During the All-Payer Model, Maryland’s hospitals successfully reduced unnecessary readmissions and hospital-acquired conditions, while decreasing the growth in hospital cost per capita.  However, the approach under the All-Payer Model focused on hospitals and did not sufficiently provide for comprehensive coordination across the entire health care system.  Because of this limitation, the federal government required Maryland to develop a new model that encompasses all of the health care that patients receive, both inside the hospital and the community.  On July 9, 2018, Maryland and the federal government signed the Total Cost of Care Model State Agreement, which became effective January 1, 2019.

​​Key Elements of the Total Cost of Care Model
To achieve a patient-centered system, the Total Cost of Care Model includes the following key elements:

●    Care will be coordinated across both hospital and non-hospital settings, including mental health and long term care.

●    The Model will invest resources in patient-centered care teams and primary care enhancements. 

●    Maryland will set a range of quality and care improvement goals.  Providers will be paid more when patient outcomes are better.

●    Maryland will set a range of  hospital quality, care transformation, and population health goals as part of the Statewide Integrated Health Improvement Strategy​.

●    State flexibility will facilitate programs centered on the unique needs of Marylanders, the provider community, geographic settings, and other key demographics.  

As part of the federal agreement to put the new Total Cost of Care Model in place, all-payer hospital cost growth continues to be limited to 3.58% per capita, a limit that was set in 2014 based on long term growth in Maryland’s economy.  As part of this Model, Maryland commits to saving $300 million in annual, total Medicare spending by the end of 2023. The Medicare savings required in the TCOC All-Payer Model will build off of the ongoing work of Maryland stakeholders, which began in 2014. 

 Additional information​ is available in the following resources and the list of documents below:

●    A brief background and summary​ of the Total Cost of Care Model with key requirements;

●    Announced Terms of the TCOC Model​; ​ 

●    Stakeholder engagement through HSCRC and MDH workgroups​; ​ 

●    All-Payer Model Performance, through 2018 Year-to-Date Results​​​​; and 

●    Maryland Primary Care Program​