HIGHLIGHTS
- Maryland needed support implementing its statewide value-based care model.
- Abt helped Maryland design and benchmark value-based healthcare programs statewide.
- Maryland’s model saved $689 million and has informed national policy.
PROJECT
MD HSCRC Commercial Claims Data & Related Analytics and MD HSCRC Value Based Program Design
The Challenge
The Centers for Medicare & Medicaid Services (CMS) Innovation Center partners with states to test new ways of improving health care quality while managing total costs. One such approach is the Total Cost of Care (TCOC) Model, which holds states accountable for the full cost and quality of care across inpatient, outpatient, and other services for all residents.
Maryland adopted the TCOC Model in 2019. The Model relies on hospital global budgets—fixed annual payments to hospitals that replace traditional fee‑for‑service payments and incentivize more coordinated, efficient care. Within this Model, the Care Redesign Program allows hospitals to make incentive payments to non-hospital providers that partner with the hospital and perform a variety of care redesign initiatives aimed at improving quality of care.
To implement and sustain these value‑based programs, the Maryland Health Services Cost Review Commission (HSCRC) requires statistical, actuarial, and technical input to support program design, monitoring, and refinement.
The Approach
Abt supports Maryland’s HSCRC on two contracts for design and implementation of value-based healthcare programs.
In one, Abt leads a team tasked with benchmarking Maryland’s health care spending, quality and health care use among people with employer-sponsored insurance to communities across the U.S. The HSCRC uses these findings to identify areas to target improvement efforts and implement incentives, as well as track the state’s performance over time.
In the second, Abt assists the Maryland HSCRC with methodologies to define, implement, monitor, and evaluate value-based programs that incentivize healthcare transformation across hospital and non-hospital providers in the state. Abt also conducts analyses to support program participants implementing care transformation initiatives and respond to other stakeholder inquiries.
The Results
In its first three years (2019-2022), Maryland’s use of the TCOC Model was associated with savings yielded $689 million in savings by limiting growth in hospital budgets, reducing admissions, and improving quality measures—mainly due to hospital responses to global budget incentives and substantial baseline room for improvement
Maryland’s proven success with a hospital global budget as a tool for sustainable health care transformation informed its selection in 2025 as one of six states chosen to test CMS’s new TCOC model, AHEAD, or Achieving Healthcare Efficiency through Accountable Design. This voluntary model focuses on statewide health care transformation and multi payer alignment. Its goal is to improve the overall health of the population while at the same time reducing total health care costs.