CMS Announces Cost Reduction Medicare Advantage VBID Model
By - The Medicare Advantage Value-Based Insurance Design (VBID) Model, announced by the Centers for Medicare & Medicaid Services (CMS), aims to advance the health of Medicare beneficiaries, decrease preventable high-cost care utilization, and slash plan costs.
According to CMS, the VBID Model “is an opportunity for Medicare Advantage [MA] plans to offer supplemental benefits or reduced cost sharing to enrollees with [CMS]-specified chronic conditions, focused on the services that are of highest clinical value to them. The model will test whether this can improve health outcomes and lower expenditures for Medicare Advantage enrollees.”
CMS explains under current MA requirements regarding universality standards, typical requirements stand that MA plan’s benefits and cost sharing specifics remain standardized across plan enrollees. Nonetheless, clinically-nuanced VBID approaches, CMS says, are usually not integrated into MA/MA-PD plans, CMS says.
“The model will test the hypothesis that giving MA plans flexibility to offer supplemental benefits or reduced cost sharing to enrollees with CMS-specified chronic conditions, to encourage the use of services that are of highest value to them, will lead to higher-quality and more cost-efficient care,” states CMS.
“The increase in high-quality, cost-efficient care is expected to improve beneficiary health, reduce utilization of avoidable high-cost care, and reduce costs for plans, beneficiaries, and the Medicare program. The model is also intended to improve outcomes and reduce costs by encouraging targeted enrollees to obtain care from high-quality providers, and by providing new supplemental benefits specifically tailored to targeted enrollees’ clinical needs,” CMS adds.
The VBID Model begins in January of 2017 and will run over a five-year period. Seven states – Arizona, Indiana, Iowa, Massachusetts, Oregon, Pennsylvania, and Tennessee – participate in testing efforts related to the Model. According to CMS, “Eligible Medicare Advantage plans in these states, upon approval from CMS, can offer varied plan benefit design for enrollees who fall into certain clinical categories identified and defined by CMS. Changes to benefit design made through this model may reduce cost-sharing and/or offer additional services to targeted enrollees.” CMS additionally confirms targeted enrollees do not receive fewer benefits or pay higher cost-sharing compared to other enrollees.
CMS confirms the model typically refers to health insurers’ efforts to organize and implement enrollee cost-sharing and other health plan design elements to coerce enrollees to purchase high-value clinical services that pose strongly beneficial health-wise. “VBID approaches are increasingly used in the commercial market, and evidence suggests that the inclusion of clinically-nuanced VBID elements in health insurance benefit design may be an effective tool to improve the quality of care and reduce the cost of care for Medicare Advantage enrollees with chronic diseases,” says CMS.
CMS additionally explains the MA-VBID Model allows for increased measures of flexibility for MA plans accepted into the model to implement clinically-nuanced benefit designs for those enrollee populations contained to one of the following categories – diabetes, chronic obstructive pulmonary disease (COPD), congestive heart failure (CHF), past stroke history, hypertension, coronary artery disease, and mood disorders.
“In addition to developing interventions targeted at all enrollees in one or more of the above categories, participating MA plans will have the flexibility to identify specific combinations of the listed chronic conditions for one or more ‘multiple co-morbidities’ groups and establish tailored VBID interventions for each group,” CMS explains. “Participating MA plans are required to provide VBID benefits to all VBID-eligible enrollees in the selected group,” the organization adds.
