How New Value-Based Insurance Impacts Medicare Beneficiaries
The new Value-Based Insurance Design will impact Medicare beneficiaries exponentially. Discover how quality of care in 2020 will be pushed to the forefront of doctor priority.
Medicare beneficiaries are going to see a positive shift in benefit options as early as next year. Patients can expect to see a higher quality of care in 2020 due to new provisions introduced by the Center for Medicare and Medicaid Services (CMS).
One of these incredible provisions is the expansion of Value-Based Insurance Design or VBID for short. A change made in the Chronic Care Act expanded testing of the Medicare Advantage Value-Based Insurance Design Model nationwide.
This is great news! The VIBD model gives plans the ability to create customized benefits for a certain enrollee population. The benefits offered are determined by specific conditions and/or socioeconomic status.
Value-Based Insurance Design (VBID): How it Started
The Centers for Medicare and Medicaid Services (CMS) designed a voluntary VBID model in 2015. This model was created for insurance carriers offering Medicare Advantage plans.
The purpose of this VBID model? To test the impact of offering Medicare Advantage organizations (MAOs) more flexibility in the design of benefits. Things like reduced cost sharing or extra supplemental benefits to patients with certain chronic conditions.
CMS stated in the VBID model 2020 – this model was created to lessen Medicare expenses while improving the quality and coordination of health care for Medicare beneficiaries.
Before the VBID model, Medicare Advantage organizations were unable to offer VBID due to federal requirements (they wanted benefits to remain consistent).
Particularly, MAOs needed to abide by the requirement that:“All plans must be offered at a uniform premium, with uniform benefits and cost-sharing throughout the plan’s service area…to all Medicare beneficiaries with Parts A and B of Medicare.”
Now, CMS has lifted the uniformity requirement for qualified Medicare Advantage organizations in half of the U.S.
25 States included: Arizona, Indiana, Iowa, Massachusetts, Oregon, Pennsylvania, Alabama, Michigan, Texas, Tennessee, California, Colorado, Florida, Georgia, Hawaii, Maine, Minnesota, Montana, New Jersey, New Mexico, North Carolina, North and South Dakoda, Virginia, and West Virginia.
VBID testing in these states allowed for the following diseases: chronic obstructive pulmonary disease (COPD), diabetes, congestive heart failure, history of strokes, coronary artery disease, hypertension, mood disorders, and variations of the different categories.
Since the initial model release, nearly 60,000 beneficiaries were affected. Alabama, Michigan, and Texas will allow testing for dementia and rheumatoid arthritis.
Mid-January 2019 the CMS announced the upcoming changes to the VBID model for the following year (2020). Changes include allowing plans in ALL 50 states and U.S. territories to apply.
This includes plan types that weren’t initially part of the VBID model.
For instance, plan types such as Regional Preferred Provider Organizations (RPPO) and all Special Needs Plan (SNP) types – Chronic Condition SNPs (C-SNP), Dual Eligible SNPs (D-SNP) and Institutional SNPs (I-SNP) will be included in the VBID model for the calendar year 2020.
The updated VBID model for 2020, gives an opportunity to new MAOs that might want to apply. Thus, MAOs should look over the current VBID model for Medicare Advantage to see what it has to offer.
One example of how the value-based insurance design will impact Medicare patients in 2020 has already begun. Since the Medicare Advantage program started broadening benefits, beneficiaries are continuously enrolling in them over Original Medicare plans.
Enrollment for MA plans is expected to reach an all-time high in 2019. According to CMS, 22.6 million Medicare beneficiaries are signed up for this program.
VBID Benefits in 2020
Come January 2020, Medicare Advantage (MA) plans can offer reduced cost-sharing and extra supplemental benefits. Benefits for enrollees will be more customized to their situation than ever before.
The same is true for benefits that aren’t directly related to health care. Benefits such as transportation for home health and home care providers can be a huge help for many beneficiaries.
According to a recent nationwide poll, (conducted by the National Aging and Disability Transportation Center) about 1 in every 5 older adults will give up driving privileges after their 65thbirthday.
Access to covered transportation services can assist home health-care agencies, by helping clients get to and from important health-related appointments.
About 3.6 million people (mostly older patients) will miss health-related appointments every year. Benefits of transportation services should lower this number greatly.
This updated VBID includes more benefits specific to managing chronic conditions, telehealth services, for those who qualify for a low-income subsidy, and (or) are dual-eligible.
Participating MA plans can offer telehealth services as a substitute for in-person health care visits. If the MA plan will cover face-to-face visits for a health issue – then the MA plan will also cover telehealth services.
CMS is testing out another new program, hoping to effectively influence members to create healthy behaviors by offering more meaningful rewards and incentives.
Rewards and Incentives programs
These RI programs have allowed costs that better reflect expected benefits for health-care, up to the annual limit. Reflections should promote a healthier lifestyle, prevent injuries and illness, and aid in using health care resources efficiently.
Medicare Advantage plans offering a Prescription Drug Plan (MA-PDs) can offer RI programs too. Likewise, RI programs are provided to patients who take Medicare-covered Part D prescription drugs.
RI programs are also for those participating in the following: disease state management programs, medication therapy management with health-care providers (or pharmacists), and preventative health services.
Lastly, enrollees are required to stay updated with prescribed medications – including the understanding of any generic alternatives that may be more cost-friendly.
VBID Hospice Benefits
Although it’s not in place just yet – come 2021, the VBID model testing will allow MA plans to offer benefits for Medicare’s hospice coverage.
Recent updates were created to give more access to hospice-related services and provide better coordination between hospice providers – ultimately providing better hospice care for members.
The highly anticipated 2021 CMS update to VBID, allowing hospice benefits is expected to have the largest impact. Hospice care is not currently a covered benefit in Medicare Advantage plans, so for beneficiaries, this is BIG NEWS.
Value-Based Insurance Design has Cost Reduction in Mind
The current versions of Medicare Part D and Medicare Advantage haven’t been updated in over a decade. The CMS debates were well over-due for an upgrade.
As times are changing, so are the advances in health care. What worked for benefit options a decade ago – isn’t quite good enough for recent years. One example is, the technological options available today, like telehealth services.
The idea behind VBID is to provide Medicare patients with optimal coverage options, lessening the costs for beneficiaries, and making the entire Medicare program more efficient.
Aiming to promote a healthier lifestyle at a more affordable rate – VBID is still proposing Medicare Advantage expansion plans. Expect more updates and changes to be launched over the next few years.
About the Author
Jagger Esch is the President & CEO of Elite Insurance Partners and MedicareFAQ, a senior healthcare learning resource center. As a young entrepreneur and seasoned insurance expert, he has a passion for helping people. Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. Jagger lives in the Florida sunshine state and loves boating with his family on the weekends.View All Articles