BLOG: Top takeaways from the 2018 V-BID Summit
Kristin Rodriguez, Health Plan Alliance
Last week I attended the 2018 V-BID Summit, an annual event and fundraiser hosted by the University of Michigan Center for Value-Based Insurance Design. TheV-BID Center was started in 2005 and its mission is to implement the concept of clinical nuance into payment reform initiatives and health plan benefit designs, so that consumers, providers, and payers are able to achieve the best patient-centered outcomes for the money spent. Alliance members will remember Dr. Mark Fendrick from our 2017 Spring Leadership Forum and his presentation on changing the health care discussion from “how much” to “how well.”
This was my first V-BID summit and I found myself surrounded by stakeholders representing health plans, CMS, employers of all shapes and sizes from across the country, pharmaceutical companies, as well as industry conveners who—like the Alliance—seek to bring players together to solve problems and promote best practices. At its heart, value-based insurance design is concerned with understanding how to influence the actions of each stakeholder participating in health care funding, delivery and consumption. I saw this common thread in each of the event’s panel discussions, which dug deep into developing “smarter” high-deductible health plans (HDHPs), finding alignment between providers and patients on quality, defining the hopes and expectations public payers have for V-BID, and how we as an industry are doing when it comes to eliminating low-value care. Here are some of my major takeaways and reactions to the event.
We’re hitting the upper limit of the benefits derived from cost shiftingCost shifting has been the subject of critical discussion for many years—payers have moved more and more financial responsibility to individual consumers through increased premiums and higher deductibles, but there is growing concern that this approach has thrusted risk sharing arrangements on a public that is entirely unprepared. Even the savviest consumers demonstrate poor working knowledge of how healthcare is financed and even less understanding of how to gauge quality when choosing between delivery options. Michelle Drozd, MS, Deputy VP in the policy and research department with PhRMA, argued that price and quality transparency must go hand in hand because patients tend to use price as a proxy for gauging quality: if one service provider is more expensive, patients assume they deliver higher quality care. Until health care consumers are better able to effectively manage the greater financial risk embedded in today’s typical HDHP, they must be able to engage in thoughtful decision making with all of the relevant information available to them. Perhaps even more troubling, raising deductibles doesn’t address the costs driven by 20% of the population that is driving 80% of the spend. This population is particularly challenged by greater cost shifting in HDHPs because the treatment required to manage chronic illnesses is often subject to deductibles. This, according to Paul Fronstin, Ph.D., director of the health research and education program at EBRI, who also reminded summit participants that the notion of a deductible is a borrowed mechanism from property and casualty insurance and really only makes sense if we’re talking about insurance truly designed for nothing more than catastrophic coverage. Adam Beck, JD, VP for employer health policy and initiatives at AHIP, echoed this sentiment. He highlights the evolution in thinking our industry is experiencing now with policy driven shifts to population health: today’s insurance products are focusing on health and wellness and payers are investing in the individuals’ health like never before. All panelists agreed that cost shifting is a poor substitute for what’s really needed—a shift to a smarter product design.
Some considerations for a “smarter HDHP”:
- Employer's contribution to the health savings account (HSA) can be made available at the start of the plan year, to support the 44% of Americans who can’t afford an unexpected $400 health care expense.
- While HDHPs work well for some, they are problematic for individuals with chronic illnesses and can truncate the idea of having “skin in the game.” A potential solution can be found in amending the IRS “safe harbor” to allow health plans the flexibility to cover additional evidence-based services prior to meeting the plan deductible.
- Consider smoothing the deductible—allow patients to pay it over time, hitting a monthly “quota” instead of a lump sum from the start.
- Think outside the traditional annual election period. Consider longer time horizons that reflect the long term investment the payer and the consumer are both making in “health care” over the long run. (Bonus content—hear a case study from SelectHealth, an Alliance member that has been working on multi-year contracts with employer groups)
- While raising deductibles is the easiest lever to pull, there are many other ways to lower costs without shifting them to the consumer.
- There is a relationship between medication compliance and professional/hospital costs and smarter HDHPs might exempt certain meds to promote compliance and to lower total costs.
Eliminating low value care will help fund value based insurance designV-BID is focused on making it easy for patients and physicians to do the right thing through mindful benefit design. One powerful lever here is cost—if insulin had no co-pay, it is much easier for a diabetic to access that treatment. But how do you make that an actuarially sound argument? Drawing on the work of the Choosing Wisely campaign and others, a task force on low-value care identified their “top five” low-value clinical services that are unsafe, do not improve health, or both. These included:
- Diagnostic testing and imaging before low-risk surgery: $9.5 billion in avoidable spending
- Vitamin D screening tests: $800 million in avoidable spending
- Prostate-specific antigen testing for men 75+: $44 million in avoidable Medicare spending
- Imaging for low-back pain within six weeks of onset: $500 million in avoidable spending
- Branded drug use when chemically equivalent generics are available: $14.7 billion spent unnecessarily on branded drugs.
Some low-value medical interventions are part of what is considered “standard of care” and it takes a while to change physician behavior. Many are also patient satisfiers. Imagine a scenario where the physician tells the patient, “I would send you for this test just to be safe, but your insurance company won’t pay for it.” The health plan is painted as bad, and then does the star rating suffer?
Read the October 2017 Health Affairs article for full details on the low-cost, high-volume health services that contribute the most to unnecessary health spending.
On this topic in particular, audience members and the session panel had a few passionate exchanges concerned with the critical moments of truth during conversations about eliminating low-value care.
- Once you get providers’ attention on low-value care, it takes systems of intervention to change behavior. Culture alone won’t do it.
- Employers are hungry for transparency here, and are looking for insights from third-party administrators (TPAs) to help them make good decisions that best support their employees’ needs. (Translation: Better reporting. For bonus content on employers’ appetite for reporting, check out this presentation recording from Adventist Health System regarding Walt Disney’s appetite for value and the recording of Linda Brady, human resources leader with The Boeing Company, discussing integrating to meet market demands)
- If you want to get physicians and patients aligned regarding low-value care, help them focus their conversations on harm.
By effectively eliminating low-value care from the system, we create headroom to pay for the high value—we give ourselves the opportunity to design benefits so that they remove barriers blocking physicians and patients from executing on the best care for that patient’s health needs. We know there are already headwinds preventing the right care from getting to the right patient in the right setting—we absolutely must avoid creating additional barriers through our benefit design.
The MA V-BID Demo is an area of focus in the Health Plan Alliance 2018 educational programmingWebinar on May 2: The MA V-BID Evolution | Register Now
In this presentation, Brad Helfand, Managing Director with HealthScape Advisors, will provide an overview of Medicare Advantage (MA) V-BID, share exclusive insights from organizations that participated in the pilot program, and provide a roadmap for plans assessing options to enter the new, expanded program.
Value Visit August 6–10: Government Programs | Save the Date
The draft agenda for this expansive program is coming soon, but if you’re an Alliance member operating in MA, Duals, Medicaid, or the ACA, save the date for August 6–10 and plan on joining us in San Francisco. We’ll be focusing on MA both Monday and Tuesday of this value visit, and deep dive into V-BID and how MA plans can consider this expanded demo, alongside other new tools now available that offer flexibility in benefit design and member engagement efforts, as part of a larger strategy to increase member compliance and ultimately improve outcomes. More to come—please save the date on your calendar, and join us for the value visit planning vall on May 3 to share your ideas for additional case studies and critical topics you want to be sure are included in the agenda.
The nature of health care continues to change, and the 20th century health plan designs are being quickly left behind. Payment reform and benefit design are powerful levers policymakers, regulators, and key stakeholders like employer groups and government payers are manipulating in earnest. The Alliance will continue supporting conversations among our member health plans regarding efforts to balance quality, cost and care, and how we as payers can help bring the greatest value to providers and patients.
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