Maryland State Specific Strategies

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On November 19, 2007, Governor Martin O’Malley (D) signed the Working Families and Small Business Health Coverage Act which provides for subsidies to small employers and employees of small employers if the employer:

  •  has not offered a health benefit plan within the prior 12 months;
  • has two to nine eligible employees;
  • meets certain low-wage requirements to be established through regulation;
  • establishes a Section 125 payroll deduction plan to allow for pre-tax premium contributions; and,
  • agrees to offer a wellness benefit that is designed to prevent disease, reduce poor clinical outcomes, and promote health behaviors and lifestyle choices.

The yearly allocation from the state for this program is scheduled to be $30,000,000.

Maryland's Fair Share in Health Care Act – On January 12, 2006, the Maryland General Assembly over-rode Governor Robert Ehrlich's (R) veto and passed legislation requiring private-sector for-profit employers with 10,000 or more employees in the state to spend at least eight percent of their payroll (or six percent in the case of a nonprofit employer) on health care. Employers that fell below the required level would have to pay the difference between their health insurance expenses and the percentage threshold into a new Fair Share Health Care Fund, which would direct the funds into the state's Medicaid program.
In February 2006, the Retail Industry Leaders Association (RILA) filed suit in the U.S. District Court for the District of Maryland seeking to invalidate Maryland 's Fair Share in Health Care Act. In response U.S. District Judge J. Frederick Motz struck down Maryland 's "Fair-Share" Act, declaring that the measure was pre-empted by ERISA and was therefore invalid. The ruling affirmed that since the passage of the Employment Retirement Income Security Act (ERISA) in 1974 the regulation of employee benefits resides with the federal government.
Maryland AIDS Drug/Insurance Assistance ProgramMADAP is a statewide program which helps low-to-moderate income Maryland residents who are HIV-infected. The MADAP formulary covers a range of medication used to treat HIV infection and to treat, prevent, or relieve certain conditions associated with HIV infection. The income guidelines for MADAP, and MADAP-Plus, are based on 500 percent FPL. The income guidelines for MAIAP (Insurance) are based on 300 percent FPL.
Hospital All-Payer Rate Setting System – Since 1977 Maryland has operated a hospital all-payer system. Under this system the Maryland Health Services Cost Review Commission (HSCRC) sets rates that Maryland's hospitals may charge.   This payment system distributes the cost of hospital uncompensated care among all purchasers including Medicare, Medicaid, commercial carriers, and self-paying patients. Medicare is required to pay these state-established rates for hospital services under a unique federal waiver. 
Maryland Health Quality and Cost Council – In addition, Governor O’Malley, through an October, 2007 executive order, created the Maryland Health Quality and Cost Council. The Council is charged with:
  • Coordinating and facilitating collaboration on health care quality improvement and cost containment initiatives by the various stakeholders in the health care system;
  • Making recommendations on health care quality and cost containment initiatives and priorities to policy makers, state and local governmental entities, professional boards, the Maryland Patient Safety Center, industry groups, consumers, and other stakeholders;
  • Developing a chronic care management plan to improve the quality and cost-effectiveness of care for individuals with, or at risk for, chronic disease;
  • Facilitating the integration of health information technology in health care systems; and
  • Examining and making recommendations regarding other issues relating generally to the Council’s mission to improve health care quality and reduce costs.