In a comment little noticed by major media, Democratic presidential candidate Hillary Clinton during the Sunday night debate expressed interest in shifting Medicare to a payment system where hospitals charge the same amount for procedures regardless of a patient's insurance coverage.
Experts say using Maryland's "all-payer" system would be difficult to implement, although not as difficult at candidate Bernie Sander's single-payer plan, whose broad outlines the Vermont Senator unveiled over the long holiday weekend.
During a primary debate Sunday, Maryland Gov. Martin O'Malley touted the "all-payer" system the state has used for more than 30 years. It has helped stop cost-shifting among payers and has slowed the growth of per-admissions costs.
“That's the future,” O'Malley said. “We need to build on the Affordable Care Act, do the things that work, and reduce costs and increase access.”
Clinton, who said earlier she is “absolutely committed” to universal healthcare, said Maryland's program is “one of the models that we will be looking at to make sure we do get costs down, we do limit a lot of the unnecessary costs that we still have in the system.”
Maryland, along with several other states, began using an all-payer system in the late 1970s. Eventually the rest of the states moved away from the model.
Two years ago, while O'Malley was governor, Maryland and CMS announced some changes to the model that shifts the focus from Medicare costs per inpatient admission to per capita Medicare cost growth for each hospital. The extension was seen by some observers as the first step toward moving traditional Medicare to a capped payment model.
It also agreed to generate a certain amount of savings while also limiting cost growth and achieving certain quality targets over the next five years. CMS said this would test the all-payer model, which could then be used by other states.
Dylan Roby, an assistant professor at the University of Maryland School of Public Health, said the new requirements were in alignment with the ACA's goal of value-based payments. There is limited data for the new agreement, but what has been studied showed no particular cost overruns or quality concerns. It also showed no major improvements in cost control to date.
Other states have ways of copying Maryland, such as through waivers and innovation grants, Roby said.
“There are existing mechanisms in the Affordable Care Act that allow for some level of experimentation with this type of approach,” he said.
It would, however, require agreement among hospitals, insurance companies and government officials. That would likely be more difficult for any state now than it was for Maryland in the 1970s, he said.
“I do think that would take some hard political discussion,” he said.
Roby said all-payer is not the same as single-payer. The rate setting applies only to hospitals, and hospitals aren't all paid the same. A hospital could have a different rate than another hospitals across town, it would just have to charge all patients in its hospital the same rate.
A few hours before the debate began, Vermont Sen. Bernie Sanders released a plan he calls Medicare for All (PDF). It would raise taxes, primarily on the rich, to provide continuous coverage to all Americans and shift individual household payments from premiums to a payroll tax. How a family fared under such a plan would depend on how much they are paying for their existing employer-based plan.
Clinton said Sanders' plan was akin to “tearing up” the ACA and starting over again in a contentious congressional atmosphere. Earlier this month, Republicans pushed through a repeal of the ACA that President Barack Obama vetoed days later.
She said she would build on the ACA, such as by capping prescription drug costs to decrease out-of-pocket costs for patients.
