At the press conference announcing the new hospital spending plan are (l-r): Tom Mullen, president and CEO, Mercy Medical Center and co-chair, Hospital Executive Input Group; John Colmers, chairman, Health Services Cost Review Commission; Josh Sharfstein, M.D., Secretary, Maryland Department of Health and Mental Hygiene; and Kevin J. Sexton, president and CEO, Holy Cross Health and co-chair, Hospital Executive Input Group.

Historic Hospital Spending Plan in Maryland Receives Federal Approval

Holy Cross Health Seeks to Become Early Adopter

The federal Centers for Medicare & Medicaid Services (CMS) has approved a historic new hospital reimbursement system for the state of Maryland, replacing a nearly 40-year old system, which included a unique “waiver” from the federal Medicare program.

This action comes after the December 18, 2013 vote of the Maryland Hospital Association Executive Committee, of which Holy Cross Health President and CEO, Kevin J. Sexton, is a member. Mr. Sexton also served as co-Chair of the Hospital Executive Input Group, which was tasked by Maryland Governor Martin O'Malley to make recommendations for updating the state's Medicare Waiver. Tom Mullen, president and CEO of Mercy Medical Center in Baltimore, also served as co-chair of the group.

"This is an historic event for Maryland and likely nationally. Maryland is now in a position to be a leader in the nation as we all seek innovative methods to deliver better care and contain health care costs," said Kevin J. Sexton. "While I acknowledge the challenges ahead, it is our intention that Holy Cross Health move ahead as an early adopter of the new system."

The new plan (a five-year, renewable program) seeks to improve coordination of individual patient care by hospitals, physicians, insurers and other providers, and ultimately improve overall population health.

It will limit the rate of growth in spending on hospital care, linking it to growth in the state’s economy. This replaces the previous controls on cost per hospital discharge. Payment to individual providers will be capped and will include rewards for efficiency, good patient experience and improved clinical outcomes.

More information about Maryland's hospital spending plan is provided in the press release issued by the Maryland Hospital Association

Maryland's governor, federal officials and representatives of hospitals and insurers spoke during a press conference announcing federal approval of the hospital spending plan in Maryland.
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Maryland Governor Martin O'Malley. Kevin J. Sexton with U.S. Senator

Barbara Mikulski.
U.S. Senator Ben Cardin.