The passage of the Patient Protection and Affordable Care Act (ACA) in 2010 has led to significant gains in health insurance coverage for many Americans.  Despite this fact, many insured patients still struggle to afford the care they need—given the well-documented increase in deductibles and other consumer cost-sharing. 

Financial barriers to high-value care are particularly impactful for low-income individuals and families, as well as those with chronic conditions.  As our country grapples with the impacts of escalating health care expenditures through the discussion and implementation of alternative payment models, it’s important to improve the incentives and coverage provided by health plans to beneficiaries.

V-BID in Action

Value-Based Insurance Design (V-BID) serves as a promising solution to the misallocation of underused of high-value care and utilization of care associated with no clinical benefit.  V-BID programs selectively reduce financial barriers to evidence-based care that improve patient-centered outcomes.  The incremental expenditures incurred by this increased use are paid for by savings incurred by the reduced use of low-value care.

Although V-BID principles have generated multi-stakeholder interest and bipartisan political support over the years, implementation has been slowed by a lack of a model plan that specified high and low-value services, including the cost-sharing changes necessary to result in the same or lower total medical spending. ‘V-BID X’ plan designs look to fill this void.

There is a lot of enthusiasm for the V-BID X model plan, most notably from the Department of Health and Human Services (HHS). On January 31, 2020, in the 2021 Notice of Benefit and Payment Parameters rule, HHS declared broad support for the inclusion of V-BID principles in marketplace health plans. The rule uses language and research directly from The V-BID Center’s own guidelines for V-BID X, noting the potential of “value-based model” qualified health plans. 

V-BID X

With support from Arnold Ventures, a group of public and private stakeholders convened to specify the high and low-value services and establish the cost-sharing parameters for a cost-neutral model plan.  An independent actuarial firm was engaged to estimate the incremental spending on high-value services and the cost offsets resulting from higher cost-sharing on low-value care.

WEBINAR | V-BID X: A NEW PLAN OPTION FOR THE INDIVIDUAL HEALTH INSURANCE MARKET

After substantial deliberation, services for reduced or eliminated cost-sharing (high-value) and increased cost-sharing (low-value) were selected (Table 1).  For select services, cost-sharing was eliminated or reduced and projected additional spending was estimated using actuarial modeling.  Out-of-pocket costs were increased on the selected low-value services such that the model plan results in the same level of total spending.  If the reduction in spending on services with no clinical benefit exceeds the added expenditures on high-value care, decreased premiums will result.

Table 1. High and Low-Value Services

High-Value Services and Drugs with Highly Reduced or Eliminated Cost-Sharing Low-Value Services with No Coverage
Glucometers and testing strips
Anti-thrombotic/anticoagulants
Spinal fusions
LDL testing (hyperlipidemia)
Anti-depressants
Vertebroplasty and kyphoplasty
Hemoglobin A1C testing (diabetes)
Statins
Vitamin D testing
Cardiac rehabilitation
Antipsychotics
Proton beam therapy for prostate cancer
INR Testing (hypercoagulability)
ACE inhibitors and ARBs
Pulmonary rehabilitation
Beta blockers
Peak flow meters (asthma)
Buprenorphine-naloxone
Blood pressure monitors (hypertension)
Anti-resorptive therapy
Glucose lowering agents
Tobacco cessation treatments
Rheumatoid arthritis medications
Naloxone
Inhaled Corticosteroids
Thyroid-related
Antiretrovirals
High-Value Branded Drug Classes with Reduced Cost Sharing Commonly Used Services with Limited Value and Increased Cost-Sharing
Pre-exposure prophylaxis for HIV
Outpatient specialist services
X-rays and other diagnostic imaging
Hepatitis C directing-acting combination
Outpatient labs
Outpatient surgical services
Anti-TNF
High-cost imaging
Non-preferred branded drugs

Conclusion

V-BID X presents a template to guide organizations interested in incorporating cost-neutral, value-based principles into plan benefit design. Applying targeted cost-sharing based on the clinical value – not price – of a service will allow consumers improved access to high-value care, reduced cost-related non-adherence and decreased exposure to harmful care. Payers meanwhile enjoy the advantage of improved efficiency of their medical expenditures.