Increasing Bipartisan Support for Value-Based Insurance Design
May 1, 2014
Katie Sullivan, MA
Value-based insurance design (V-BID) encourages providers to deliver higher quality services at lower out-of-pocket costs for patients, and it is increasingly gaining bipartisan support in Congress. As part of the Affordable Care Act (ACA), V-BID principles aim to make much-needed changes to the ways that payers reimburse health providers for their services.

Both House representative Diane Black (R-TN) and Senate Finance Committee Chairman Ron Wyden (D-OR) back similar bills that would integrate V-BID concepts into Medicare and Medicaid plans. Mark Fendrick, MD, director of the University of Michigan's Center for Value-Based Insurance Design, and co-editor in chief of The American Journal of Managed Care, said that there are encouraging signs of V-BID principles catching on in the private sector.

Dr Fendrick added that this momentum to improve issues in Medicare is important. One reason is that the current Medicare regulations are inflexible, and many beneficiaries would benefit from the concept of clinical nuance. Clinically nuanced insurance design recognizes patients’ behaviors and financial constraints which might otherwise impact their medication adherence and health outcomes.

Current fee-for-service models limit cost-sharing levels, and do not encourage Medicare beneficiaries to utilize high-value providers in their network. Dr Fendrick and other economists maintain that clinical nuance would enhance coverage for those who need it most, incentive providers to participate in quality initiatives, and help guide beneficiaries to appropriate care.

The evidence for implementing V-BID continues to mount. When Blue Cross Blue Shield North Carolina’s V-BID program eliminated co-payments for generic hypertension prescription medications and lowered co-pays for brand-name medications, they increased patient adherence by between 2.7% and 3.4% over a 2-year period. The overall medication savings totaled $5.7 million. Another recent 2014 study reported that when co-pay reductions for Medicare beneficiaries using statins were implemented over a period of 6 months, it resulted in a 5.9% increase in adherence versus those paying standard co-payment amounts.

Around the Web

Value-Based Insurance Design Winning Bipartisan Support [Bloomberg]

Clinical Nuance: Benefit Design Meets Behavioral Economics [Health Affairs]

Moving Branded Statins to Lowest Copay Tier Improves Patient Adherence [AMCP]

Value-Based Insurance Design Program In North Carolina Increased Medication Adherence But Was Not Cost Neutral [Health Affairs]