Military Families, Seniors in MA and IN to Test Major Healthcare Reform

Seniors in Massachusetts, Indiana, and Pennsylvania, as well as military families across the nation, will soon get the opportunity to test a major healthcare reform developed by faculty at the University of Michigan.

Called Value-Based Insurance Design (V-BID), the new approach to insurance coverage departs from the current “one-size-fits-all” system, in which people pay standard co-pays and deductibles for their healthcare and prescription medications, and instead customizes those costs to each individual patient so they’re charged least for the treatments that benefit them most.

Thanks to the 2017 national defense spending bill, signed by President Obama last week, current and retired members of the military and their dependents who participate in TRICARE health insurance will soon test V-BID in a pilot program. By January 2018, the pilot will evaluate whether V-BID helps people with certain conditions achieve better outcomes, such as sticking with the medications they’ve been prescribed or getting care that meets specific quality standards. If the project is deemed a success, proponents hope it will lead to further rollout of the V-BID approach.

Starting in January, seniors enrolled in specific Medicare Advantage plans in Massachusetts, Pennsylvania, and Indiana who have diabetes, depression, heart disease, and other chronic conditions will also be part of a pilot project. As a result, some of their co-pays and deductibles will be reduced for specific services and providers. Under an expansion of the V-BID program in the Health Plan Innovation Initiative approved by the Center for Medicare and Medicaid Innovation, additional states and more health conditions will be added to the Medicare Advantage demonstration in 2018. Congressional members have proposed legislation expanding the pilot to all 50 states, but it has yet to be approved.

A. Mark Fendrick, who directs U-M’s Center for V-BID and co-originated the concept in 2005, said in a statement that his team is “gratified to see how this concept is spreading into critical federal insurance programs, even as we work to engage with insurers and others in many settings to help them build clinical nuance into their plan designs.”

According to the Center for V-BID website, the approach is “built on the principle of lowering or removing financial barriers to essential, high-value clinical services.” V-BID programs, also known as “evidence-based benefit design,” are designed to lower or eliminate the patient’s share of the cost for treatments proven to keep people healthy, especially preventative and chronic care. V-BID in turn raises costs for misused, unproven, or ineffective treatments and services, like visiting the emergency room to treat a back ache.

Proponents say V-BID would help reign in spiraling healthcare costs and improve patient care across the country; it also helps people to consider all the alternatives, and it encourages doctors to objectively explain the pros and cons of each treatment option in plain language. According to the National Committee for Quality Assurance, research shows that patients achieve better outcomes, report more positive experiences, and adhere to treatment plans more closely when they are more involved with making decisions about their healthcare.

Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or sschmid@xconomy.com. Follow @XconomyDET_AA

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