As Maryland continues to brace for potential federal health coverage losses, the state’s health commission is considering a proposal designed to reduce the impact on hospitals, consumers, and the broader health care system.
The proposal emerged during the Commission’s discussion of the Rate Year 2027 Update Factor and addresses concerns that upcoming federal coverage changes could increase the number of uninsured Marylanders and drive up uncompensated care costs for hospitals. According to the Commission’s estimates, projected coverage losses in the individual marketplace and Medicaid could result in approximately $128 million in additional hospital uncompensated care costs statewide, representing roughly a 0.50% impact on hospital revenues.
To address these concerns, the Commission is proposing a 0.50% increase in the Rate Year 2027 uncompensated care adjustment, divided into two components:
- 0.40% would be directed to the Maryland Health Benefit Exchange Fund to support the state’s reinsurance program and provide subsidies for marketplace enrollees.
- 0.10% would be allocated to the Maryland Health Services Cost Review Commission Uncompensated Care Fund reserve, creating additional capacity to address future increases in uncompensated care costs.
The proposal is intended to help offset projected enrollment declines in Maryland’s individual insurance market while reducing the downstream impact on hospitals and consumers. The recommendation remains in draft form and will be considered separately from the commission’s broader update factor recommendations.
While the proposal focuses on hospitals and insurance coverage, local health departments already play a critical role in providing preventive, behavioral health, and safety-net services that help reduce avoidable hospital utilization and connect residents to care. Local health departments may wish to submit comments highlighting these efforts and encouraging the Maryland Health Services Cost Review Commission to consider local health departments as potential partners for future uncompensated care funding initiatives aimed at improving access to care and reducing strain on hospital systems.
Stakeholders interested in providing feedback on the proposal or on the potential use of uncompensated care funding for FQHCs are encouraged to submit comments to hscrc.payment@maryland.gov by June 24, 2026.
Further details are available in the Commission’s Update Factor recommendation materials.
