Many Paths, One Destination
Allow me to offer a brief anecdote that conveys a bit of perspective during this time of uncertainty surrounding health care policy:
In the 1930s, serving on opposite sides during World War II, while working separately and knowing nothing of one another's plans, Hans von Ohain and Sir Frank Whittle each invented a working jet engine. Whittle used compressed air with a centrifugal flow perpendicular to the axis of rotation, while von Ohain compressed the air with an axial flow through the center of the engine. Opposite feats of engineering that relied on sound principles of physics to achieve the same outcome. Today, both von Ohain and Whittle are given equal credit for the jet engine - an invention that changed the world.
I share this story because the sense of anxiety around forthcoming federal health care policy changes - particularly changes to Medicaid - is palpable and, if executed poorly, the changes could be detrimental to Maryland's hospitals. But, as with the jet engine, we must remember that there is more than one pre-ordained path to achieve your mission of care.
New Health Secretary Dr. Tom Price has indicated his support for Medicaid block grants or per-capita caps to drive efficiency in health care delivery. Block grants would provide a fixed amount of federal funds to each state, shifting both enrollment and cost risks from the federal government to the states. Similarly, per-capita caps would shift the cost risks to the state, but the federal government would retain the enrollment risks.
Block grants and per-capita caps have long been a part of the Medicaid reform conversation. Our own Maryland All-Payer Model demonstration looks in many ways like a block grant, with a fixed amount of annual spending that each hospital may not exceed and a per capita limit on spending growth.
Block grants and per-capita caps force press a fair and valid question: What is an appropriate rate of growth in health care spending for Medicaid?
This is a question that Maryland's hospitals wrestled with several years ago, during the negotiations on the All-Payer Model. The conclusion at the time, and the evidence of the first three years has borne this out, was that there was indeed room in the health care system to both save money and improve quality. Your noteworthy
performance on the demonstration's key metrics
shows that it is possible.
There is now a shared belief that even more can be done by bringing incentives for primary care physicians and post-acute providers into alignment with those for hospitals, so that we all are providing value-based rather than volume-based care. Legislation to allow such alignment is pending before the General Assembly at the same time that we are working with state officials to negotiate with federal agencies an immediate extension of the state's All-Payer Model, which can further this alignment.
Depending on what form Medicaid policy takes, Maryland could be well-positioned to accommodate the changes, having already laid the foundation for high-quality, efficient care.
That said, we'll be watching federal activity closely. We'll make sure that if a per-capita cap or block grant system is in the mix, they are adequate to meet your needs. We'll oppose inadequate funding levels that either jeopardize the care you provide or those you care for. And we will gauge how any policy changes might interact with the All-Payer Model and fight efforts that would threaten it.
But until we know the details of any proposal, we need to avoid reflexive or emotional interpretations of vague concepts. And we need to remain confident that we may be able to invent a better solution. In this way we might take a cue from the inventors of the jet engine who proved, quite literally, that there is more than one way to get an idea off the ground.