Maryland reins in hospital costs by setting rates

Wall Street Journal, September 14, 2009

In the debate over a healthcare overhaul, Maryland's experience with setting hospital rates suggests the federal government could realize savings on health spending, but at a price of more regulation for health providers. President Barack Obama and some congressional Democrats are pushing for an independent agency to set Medicare payment rates as a key to controlling costs. In Maryland, an independent agency has been setting rates since 1977 for all patients, including Medicare beneficiaries, at the state's acute-care hospitals.