Maryland’s Proposed Total Cost of Care All-Payer Model

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.

To advance these priorities, Maryland outlined a Progression Plan” in the fall and winter of 2016 to improve care and outcomes for all Marylanders.  The Progression Plan is the State’s vision for the continued evolution of the All-Payer Model and is designed to achieve person-centered care, foster clinical innovation and excellence in care, improve population health, and moderate the growth in the total cost of care for Medicare beneficiaries.  The Progression Plan reflects input from stakeholders and the general public invited through a public comment period prior to Maryland’s filing of the plan with the federal government in December 2016.   Negotiations with the federal government for continuation of the All-Payer Model were based on the care transformation vision outlined by the Progression Plan. 

Addressing Health System Limitations

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

Since 2014, Maryland’s hospitals have successfully reduced unnecessary readmissions and hospital-acquired conditions, while decreasing the growth in hospital cost per capita.  However, the current approach focused on hospitals does 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.  The Progression Plan served as the blueprint for this Model development, known as the “Total Cost of Care Model”.  In May 2018, Maryland and the federal government announced successful negotiations of the new Model, which will begin on 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 population health goals addressing opioid use and deaths, diabetes, and other chronic conditions.

    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 will continue 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. 

Next Steps and Opportunities for Engagement

The State of Maryland remains committed to a robust process for input and feedback on the development and implementation of the new model.  Maryland stakeholders will continue the process of planning and preparation for the new Total Cost of Care Model prior to the new model’s start through participation in workgroups, councils, and provider-led innovation groups. 


Additional information is available in the following resources:

    The Updated Progression Plan submitted by the Governor to the federal government in December 2016 laying out the vision for the Total Cost of Care Model;

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

    Opportunities to engage in model development through workgroups and/or document review.

    ​​All-Payer Model​​​

    All-Payer Model Performance, through 2017 Year-to-Date Results​​

    Maryland  Primary Care Model Concept Paper​


For additional information or to seek clarification on the proposed Total Cost of Care Model, please send an email to the HSCRC staff at hscrc.all-payermodel@maryland.gov.  

Thank you for all of your support and input into this important planning for Maryland. We appreciate your input and look forward to continuing to work with you.

- Maryland Department of Health (MDH) and Health Services Cost Review Commission (HSCRC)