Currently Viewing:
The American Journal of Managed Care July 2019
Changing Demographics Among Populations Prescribed HCV Treatment, 2013-2017
Naoky Tsai, MD; Bruce Bacon, MD; Michael Curry, MD; Steven L. Flamm, MD; Scott Milligan, PhD; Nicole Wick, AS; Zobair Younossi, MD; and Nezam Afdhal, MD
Precision Medicines Need Precision Patient Assistance Programs
A. Mark Fendrick, MD; and Jason D. Buxbaum, MHSA
From the Editorial Board: Robert W. Dubois, MD, PhD
Robert W. Dubois, MD, PhD
Real-Time Video Detection of Falls in Dementia Care Facility and Reduced Emergency Care
Glen L. Xiong, MD; Eleonore Bayen, MD, PhD; Shirley Nickels, BS; Raghav Subramaniam, MS, BS; Pulkit Agrawal, PhD; Julien Jacquemot, MSc, BSc; Alexandre M. Bayen, PhD; Bruce Miller, MD; and George Netscher, MS, BS
Impact of a Co-pay Accumulator Adjustment Program on Specialty Drug Adherence
Bruce W. Sherman, MD; Andrew J. Epstein, PhD; Brian Meissner, PharmD, PhD; and Manish Mittal, PhD
Heroin and Healthcare: Patient Characteristics and Healthcare Prior to Overdose
Michele K. Bohm, MPH; Lindsey Bridwell, MPH; Jon E. Zibbell, PhD; and Kun Zhang, PhD
Medicare’s Bundled Payment Model Did Not Change Skilled Nursing Facility Discharge Patterns
Jane M. Zhu, MD, MPP; Amol Navathe, MD, PhD; Yihao Yuan, MSc; Sarah Dykstra, BA; and Rachel M. Werner, MD, PhD
Number of Manufacturers and Generic Drug Pricing From 2005 to 2017
Inmaculada Hernandez, PharmD, PhD; Chester B. Good, MD, MPH; Walid F. Gellad, MD, MPH; Natasha Parekh, MD, MS; Meiqi He, MS; and William H. Shrank, MD, MSHS
Currently Reading
Insurers’ Perspectives on MA Value-Based Insurance Design Model
Dmitry Khodyakov, PhD; Christine Buttorff, PhD; Kathryn Bouskill, PhD; Courtney Armstrong, MPH; Sai Ma, PhD; Erin Audrey Taylor, PhD; and Christine Eibner, PhD
What Are the Potential Savings From Steering Patients to Lower-Priced Providers? A Static Analysis
Sunita M. Desai, PhD; Laura A. Hatfield, PhD; Andrew L. Hicks, MS; Michael E. Chernew, PhD; Ateev Mehrotra, MD, MPH; and Anna D. Sinaiko, PhD, MPP
Physician Satisfaction With Health Plans: Results From a National Survey
Natasha Parekh, MD, MS; Sheryl Savage; Amy Helwig, MD, MS; Patrick Alger, BS; Ilinca D. Metes, BS; Sandra McAnallen, MA, BSN; and William H. Shrank, MD, MSHS
Evaluation of Interdisciplinary Geriatric Transitions of Care on Readmission Rates
Nada M. Farhat, PharmD; Sarah E. Vordenberg, PharmD, MPH; Vincent D. Marshall, MS; Theodore T. Suh, MD, PhD, MHS; and Tami L. Remington, PharmD

Insurers’ Perspectives on MA Value-Based Insurance Design Model

Dmitry Khodyakov, PhD; Christine Buttorff, PhD; Kathryn Bouskill, PhD; Courtney Armstrong, MPH; Sai Ma, PhD; Erin Audrey Taylor, PhD; and Christine Eibner, PhD
This article describes perspectives of Medicare Advantage (MA) insurers about participating in the CMS value-based insurance design model test launched in 2017.
Reasons for Joining VBID and Ways to Address Participation Barriers

Participating insurers tended to be willing to take risk and implement interventions that have not been tried before in MA. Five participants considered themselves innovators, willing to experiment with benefit design. Four participants stated that they joined the model test because VBID’s goals were consistent with their own organizational priorities of reducing spending and improving care quality. Finally, 3 participants commented on VBID’s potential to improve beneficiary outcomes by addressing structural barriers to care and increasing beneficiary engagement.

Participants did encounter the barriers described by nonparticipants. Their greater appetite for risk affected the way participants addressed these barriers. To illustrate, VBID participants handled the lack of evidence by reviewing literature on VBID in commercial plans and relying on their best clinical judgment. Many participants wanted to innovate: “We’re very innovative in a lot of the things we do. We try things. Anytime something new comes up, we tend to get involved in those things just because it’s an opportunity one way or another” (PInsurer03). Others considered VBID a useful benefit design experiment: “We’re certainly willing to go down the road of a demonstration to figure out if our hypothesis that by sending members to their specialists more we can reduce their inpatient hospitalization and their high-cost care is true or not” (PInsurer05).

Most VBID participants agreed that VBID cost savings would be minimal and focused on maximizing long-term outcomes, such as decreased hospitalizations and emergency department use, while reducing implementation costs. According to PInsurer03, VBID would yield benefits “if you can really do something that is going to help the population longer term, [such as] better quality of life [or] lower long-term costs, those are all good things.” To increase the chance of a positive ROI, several participants noted that they had designed their interventions to minimize implementation costs: “We needed to come up with something that would not add additional resources and cost to the actual program that we have now” (PInsurer03). Participants relied on existing programs and processes when possible, which helped them design interventions that were easier and less costly to implement.

VBID participants agreed that managing 2 sets of benefits within a plan, or what they called “a plan within a plan” (PInsurer06), was a serious implementation challenge. Managing VBID-eligible beneficiaries required substantial IT investments and extensive coordination across departments because multiple systems, such as claims processing or care management tracking systems, had to interact with each other. A representative of PInsurer07 noted that it had to modify about 15 applications before VBID rollout.

Insurers developed different approaches to tracking eligibility, participation status, and the correct payment amounts for beneficiaries eligible for reduced cost sharing. Some VBID participants “separated” beneficiaries or created different internal groups in their IT systems to flag VBID participants. As PInsurer06 explained, “We duplicated the existing structure of our benefits and made a separate benefit structure…a dedicated line for these members.” PInsurer07 created flags within internal IT systems to identify VBID-eligible and VBID-enrolled beneficiaries.

VBID-participating insurers also considered VBID marketing restrictions to be problematic, citing potential confusion among beneficiaries, many of whom were not notified about their VBID benefits until January 2017, months after receiving Annual Notice of Change and Evidence of Coverage documents that detailed all benefit changes. To address beneficiaries’ confusion, some MA insurers called eligible enrollees in addition to sending them letters describing new VBID benefits in January.

Although VBID participants understood CMS’ rationale for restricting advertising, they still noted that these restrictions may negatively affect beneficiaries’ awareness of and participation in VBID: “I understand the CMS’ concern around selection or cherry-picking…but [if we could market VBID,] we probably would have had more people say, ‘Hey, let me see if I’m eligible’ as opposed for us having to wait for things to hit the system” (PInsurer04).


VBID nonparticipants cited a perceived lack of information on VBID in MA, expectations of low ROI, potential administrative and IT hurdles, and concerns about the test’s design as the main reasons for not joining the MA VBID model. By contrast, participating insurers were interested in experimenting with benefit design, even if the ROI was uncertain; implementing interventions consistent with their organizational priorities; and improving beneficiary outcomes by addressing structural barriers to care and increasing beneficiary engagement. Risk tolerance among upper management and an entrepreneurial organizational culture that encourages innovation seem to differentiate VBID participants and nonparticipants. During the initial implementation period in 2017, most VBID participants encountered the administrative and IT hurdles feared by the nonparticipating insurers but overcame them. They also agreed that certain model test characteristics, such as marketing restrictions, may have limited their abilities to design their preferred interventions or made the implementation challenging.

Based on the feedback from both groups, CMS changed the model parameters for 2018 and 201925,26 and relaxed some of the marketing restrictions.27 In particular, CMS added rheumatoid arthritis and dementia to the list of eligible conditions, allowed insurers to propose their own methods for identifying eligible beneficiaries, and made C-SNPs eligible to participate.

Copyright AJMC 2006-2020 Clinical Care Targeted Communications Group, LLC. All Rights Reserved.
Welcome the the new and improved, the premier managed market network. Tell us about yourself so that we can serve you better.
Sign Up