V-BID’s Role in State Employee Health Plans

Currently, over 19 million state and local employees, or about 10 percent of the total U.S. workforce, receive health care through a public employee health plan. Facing growing health care cost burden, some state and local governments have turned to Value-Based Insurance Design (V-BID) as a way to decrease health costs, improve health, and maintain competitive benefit plans for employees.

V-BID alters the amount of consumer cost-sharing based on the health benefit provided by a specific clinical service–not the price. By aligning patients’ out-of-pocket costs with the value of services, V-BID can keep public employees healthier, reduce the number of sick days used, and improve workplace productivity.

Employee-Benefits-PackageCurrently, states pay $25.1 billion a year to provide benefits to their employees. Finding a way to control these costs effectively has become a priority for many state governors and legislatures.  Additionally, across the U.S., an excise tax–sometimes referred to as a “cadillac tax”–for generous health plans goes into effect in 2018, and incentivizes employers to keep the benefit value of their health plans below $27,500.

Multiple state and local governments have introducing value-based insurance design (V-BID) into their public employee benefit package to promote high value care and encourage employees to take an active role in managing their health care decisions.

For additional information about these public employee plans, read our:

1-Pager           Issue Brief           Issue Overview

Additional Resources