Analysis of the Costs and Impact of Universal Health Care
Models for the State of Maryland:
The Single-Payer and Multi-Payer Models

John F. Sheils and Randall A. Haught

The Lewin Group, Inc.

Funded by:

The Aaron Straus and Lillie Straus Foundation, Inc.
The Jacob and Hilda Blaustein Foundation, Inc.

Table of Contents
I.  Introduction
II.  A Single-Payer Program for Maryland

A.Benefits Package
B.Managed Care
C.Program Administration
D.Health Spending Budgets
F.Marylanders Employed Out-of-State
III.   Estimating the Impact of the Single-Payer Model in Maryland
A.The Health Benefits Simulation Model
B.Projections Through 2001
IV.  Changes in Aggregate Health Spending Under a Single-Payer Program
A.Changes in Health Spending
1.Health Services Utilization
2.Administrative Costs
3.Changes in Provider Payment
B.Health Spending by Major Payers for Care
C.Health Spending in Future Years
V.  Government Spending Under the Single-Payer Model
A.State Program Expenditures
1.Program Expenditures
2.Inter-Governmental Transfer Revenues
3.Tax Revenues
B.Federal Health Spending in Maryland
VI.  Employer Health Spending
A.Impact on Total Private Employer Spending
B.Impact on Employer Health Spending by Size of Firm and Industry
C.Wage Effects
VII.  Household Health Spending
A.Impact on Total Household Health Spending
B.Impact on Average Household Health Spending
C.Distributional Impacts
D.Impact on Households by Current Insurance Status
VIII.  The Multi-Payer Universal Coverage Model
A.The Multi-Payer Opt-Out
1.Calculating the Payroll Tax for Employers that Opt-Out
2.Potential Gaming By Employers
B.Impact on State Health Spending
1.Expenditures by Payer Group
2.Employer Health Spending
3.Impact on Family Health Spending
IX.  Caveats
Appendix A: Data and Methods Used in Analysis of the Single-Payer Program in
Appendix B: The Financial Impact of a Multi-Payer Universal Coverage Program for
Maryland: Detailed Tables