Value-based insurance design

There is strong evidence that value-based insurance design (VBID) increases patients’ adherence to medication and reduces their out-of-pocket expenses^{2, 3, 4}. Additional evidence is needed to confirm effects of VBID on clinical outcomes and health care utilization and spending³.

Value-based insurance plans that provide generous benefits, target high-risk patients, offer wellness programs, provide financial incentives only for medication ordered by mail, and do not offer disease management programs have a significantly greater impact on medication adherence (4-5 percentage points) than plans without these features⁵. VBIDs that target costs of low value as well as high value care are more likely to moderate cost growth and improve overall value than plans that only encourage the use of high value care; however, categorizing any health care services or medications as low value is politically challenging⁶. A Connecticut-based study indicates greater use of standard preventive measures such as colonoscopies, pap smears, and lipid tests for all plan enrollees and increased service utilization for individuals with chronic conditions such as diabetes, heart disease, and asthma following VBID implementation⁷.

By reducing copayments and improving medication adherence, VBID appears to reduce racial and ethnic disparities, and improve cardiovascular disease outcomes for minority patients^{8, 9}. VBID is also a suggested strategy to reduce disparities in health care outcomes between individuals with lower and higher incomes⁹; however additional evidence is needed to confirm these effects³.

Overall, VBID appears to be cost neutral in the first three years after implementation, as increases in prescription drug spending balance reductions in non-drug medical spending³. VBID is a suggested strategy to reduce health care spending in the long-term, however, studies are needed to confirm effects over time^{1, 2}.

The Affordable Care Act (ACA) Section 2713 mandates coverage of certain preventive care services through group health plans and individual health insurance coverage, establishes guidelines for using value-based insurance design, and restricts the use of cost-sharing or copayments for specified high value services and medications¹⁰. As of 2014, 40% of commercial in-network payments were considered value-oriented¹¹.

Many local governments and public entities have implemented aspects of VBID in their public employee health plans, for example, the state of Oregon, Colorado Springs School District 11, and Chippewa County, Wisconsin. Many large companies and corporations have also implemented VBIDs, such as CVS Caremark, Pitney Bowes, Caterpillar, and Marriott International¹.