Maryland has been a pioneer in state healthcare system reform. Maryland is the only state in the country that sets rates for hospital services under the Maryland All-Payer Model launched in 1971, later revised in 2014 to include global budgets for all hospitals in the state. In 2018, the Centers for Medicare and Medicaid (CMS) approved Maryland’s application to expand its all-payer global budgets model beyond hospitals to nursing homes, mental health facilities, and other nonhospital settings. Under the new five-year contract, the Maryland Model will expand the state’s successful pilot program and take affect January 1, 2019.
In its efforts to contain healthcare costs, Maryland has also been active in promoting price transparency. Maryland has an active All-Payer Claims Database (APCD), the Maryland Medical Care Data Base (MCDB),operated by the Maryland Health Care Commission (MHCC). In 2017, the MHCC launched a online pricing tool named “Wear the Cost” that allows Maryland residents to compare the costs of common medical procedures using commercial insurer data from 2015 and 2016.
In recent terms, Maryland has been active in regulating prescription drug costs. In the 2017 legislative term, Maryland passed HB 631, which combats price gouging and gives Maryland’s Attorney General the power to hold companies accountable for unconscionable increases in generic or off-patent drug prices. The purpose of the bill is to rein in rising drug costs, reduce premiums, and promote equitable health outcomes. However, the 4th U.S. Circuit Court of Appeals found the law to be unconstitutional because it violates the dormant commerce clause.
In the 2018 term, the state introduced multiple bills to address price transparency and healthcare costs. To promote pharmaceutical drug transparency, Maryland passed bills that prohibit pharmacy benefit manager (PBM) gag clauses. The state unsuccessfully attempted to address the root of the rising drug costs by introducing legislation to investigate how to make prescription drugs and basic health care coverage more accessible and affordable. Although a bill to establish comprehensive universal health coverage for Maryland residents failed, the Maryland Legislature passed several pieces of legislation that funds the State Reinsurance Program, which could reduce health insurance premiums and mitigate the impact of high-risk individuals on certain rates in the Affordable Care Act’s healthcare exchanges. Governor Larry Hogan signed the legislation in April 2018, and Maryland completed its Section 1332 state innovation waiver in July 2018 to implement the program. Finally, Maryland successfully repealed a certificate of need requirement, allowing health maintenance organizations and other health care facilities to build ambulatory surgical centers.
The State Database
The Source tracks state activities impacting healthcare price and competition in both legislation and litigation in a searchable database to help stakeholders at the state level understand their legal and regulatory environment as they make efforts to improve access, quality, and efficiency, and reduce costs in healthcare. We currently cover bills from the 2017-2018 legislative term and key statutes from each state. Search the database for specific bills, statutes or cases by using keyword, key issue category, and/or jurisdiction.
LEGISLATIVE CALENDARMaryland’s 2018 legislative term ran from 1/10/18 –4/10/2018. Maryland’s next legislative term will begin in 2019.
FY 2019 BUDGETMaryland’s fiscal year begins on July 1 and ends on June 30 of the following year. Maryland enacted its FY 2019 Budget during the 2018 regular legislative session. The administration continues to invest funds into critical health care services and related programs, such as investing over $11.5 billion into the Maryland Medicaid program. To view Maryland’s FY 2019 Budget, click here.
REGULATION & ENFORCEMENT
- Maryland was one of 16 states to file an amicus brief supporting the FTC’s winning position in the Ninth Circuit appeal of St. Luke’s Health Care Sys. v. FTC, No. 14-35173 (March 7, 2014), decided February 10, 2015. The States’ brief stated that the acceleration of health care costs due to the growth of large health care provider systems had become a matter of grave concern for the states.