Organizations can assume full risk for a population through capitated payments, global budgets, and provider-led insurance plans.
Capitated and global budget programs entail flat rate payments that may be calculated on a per-member per-month basis, or could be an annual fixed rate. Total cost of care programs are intended to hold organizations accountable for aggregate healthcare expenditures and population health outcomes for an attributed population. Hospital global budgets provide a fixed payment for an attributed population.
Medicare offers several different global budget programs:
Established in 2019, MD TCOC expanded upon the Maryland All-Payer model and includes both hospital and non-hospital entities. It includes quality targets for increasing post-discharge follow-ups, reducing avoidable hospital admissions, decreasing BMI, reducing overdose fatalities, and increasing the number of attributed beneficiaries in accountable care models.
The Pennsylvania Rural Health Model is a voluntary model for rural hospitals in Pennsylvania which intends to stabilize finances through global budgets. The model is administered through the Pennsylvania Rural Health Redesign Center Authority which was established in 2019. The model accounts for inpatient and hospital outpatient services, but does not include professional and ancillary services.
The Centers for Medicare & Medicaid Services will select up to eight states to participate in a new voluntary all-payer model scheduled to begin in 2024. The model aims to curb health care cost growth, improve population health, and advance health equity by reducing disparities in health outcomes. Participating states will receive up to $12 million each to implement the model during one of three start dates, with the model concluding in December 2034. The model will build on best practices from the Maryland Total Cost of Care model, the Pennsylvania Rural Health Model, and the Vermont All-Payer ACO Model.
