Hogan’s FY 2023 budget rings in $187 million for health care providers


Nicole Pasia


Governor Larry Hogan announced his FY 2023 budget last week, marking his eight and final proposal in office. This includes a record $3.6 billion increase for Maryland’s Rainy Day Fund, and projects the first long-term, structurally-balanced budget in nearly 25 years, according to the budget announcement. 


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Here are a few health care budget highlights we’ll be following over the legislative session. 


Behavioral health and workforce supports

Hogan made a point during his budget announcement to emphasize significant budgetary investments for health care providers. The FY 2023 budget would allocate $187 million in provider rate increases, including those working in the fields of behavioral health and developmental disabilities.

A Sept. 2020 survey from the Maryland Behavioral Health Administration found that 55% of admin respondents within the behavioral health field did not feel they had enough staff to provide quality care. The same survey reported low salaries as the top reason agencies are struggling to hire more staff. 

With  growing advocacy for the reduction of unnecessary hospital admissions for developmentally disabled people, the budget includes $1.5 billion for community-based services, as well as $30.2 million to reduce program waiting lists. Approximately $97.5 million of these funds would go towards Medicaid recipients under the Behavioral Health Administration. 

Nearly $1 billion would go towards substance abuse programs. Hogan noted state funding for Maryland’s opioid epidemic response has increased by 420% over the last five years.


Local health departments

The budget sets aside $75 million for local health departments, in addition to $9.4 million from FY 2022 to aid with funding deficits caused by the pandemic. 

The departments have continued to respond to the pandemic as Hogan ordered a 30-day state of emergency earlier this month in response to an uptick in COVID-19 hospitalizations. Some are encouraging residents to report results from home testing kits to aid in contact tracing efforts.


Health care commissions

Three commissions under the Department of Health would receive a combined $260 million. The Health Services Cost Review Commission (HSCRC), which oversees hospital rate settings under the all-payer model, would receive $152 million. Most of those funds are designated for “contractual services” with hospitals and research vendors. Nearly all of HSCRC’s current contracts, which include the Medicare Claims Analytics Tool (MCAAT) and financial and hospital patient data vendors, are set to expire by the end of FY 2023.

The Maryland Health Care Commission (MHCC) would receive $35.1 million, according to the budget plan. This commission promotes access to health care through data reporting and tracking policy recommendations, such as those to the Maryland State Health Plan for Residential Treatment Services. 

Additionally, the Maryland Community Health Resources Commission (MCHRC) would receive $73 million in FY 2023. Currently, MCHRC is in the final stages of awarding $13 million in grant funding to organizations that will work to address health disparities in local communities. 

Although he didn’t specify a particular program, Hogan acknowledged an effort to support community-based care in Maryland. 

 “[The budget” establishes new equity programs to address health disparities and to improve access to primary care,” he said in his budget announcement. 

The full FY 2023 budget can be found here.