AUGUSTA— Today, the Maine Department of Health and Human Services (DHHS) and the Maine Hospital Association announced an agreement to reform hospital reimbursement rates to improve the health of Maine people.

Under the proposal, which will be included in the forthcoming supplemental budget proposal, every medical center in the state is estimated to receive roughly the same or higher reimbursement, based on information available in the fall of 2023. This proposal applies to all hospitals except for four psychiatric hospitals that are categorized differently under Medicaid.

Hospitals would become the latest major service area to undergo MaineCare’s award-winning process to ensure payment methodologies are data-driven, fair, consistent, informed by the public, and sufficient to promote access to quality care. The MaineCare rate reforms support high-quality health care for more than 400,000 Maine people and fair and sustainable reimbursement to Maine's health and social services providers, including hospitals.

Under the agreement announced today, hospitals would see improved reimbursement because the payments will better align with Medicare – a more consistent and fair approach to paying for outlier costs that relate to patient need – improved outpatient rates to encourage more community-based care when possible, and improved transparency and uniformity for similar hospitals across the reimbursement system as a whole. The agreement maximizes the available funding under federal payment limits and is subject to approval by the U.S. Centers for Medicare and Medicaid Services.

“This agreement helps MaineCare to move away from outdated and arbitrary rates and toward a uniform and fair system at a time when existing sources of ongoing revenue alone are not enough,” said DHHS Commissioner Jeanne Lambrew. “We thank the Maine Hospital Association and its members for their partnership in developing and supporting this proposal that meets our shared goal of improving the health and quality of care for Maine residents.”

“This proposal provides our members with needed Medicaid rate increases at a critical time,”said Steve Michaud, President of the Maine Hospital Association. “Drawing down additional federal Medicaid dollars helps hospitals and their caregivers, eases the burden of escalating costs on Mainers and businesses who are paying for care, and helps the Maine economy at the same time. We thank the Department of Health and Human Services for its partnership in developing this plan that supports the health of Maine people.”

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