Last year, the Centers for Medicare & Medicaid Services (CMS) introduced the Medicare Advantage Value-Based Insurance Design Model (VBID), which will test whether giving Medicare Advantage plans flexibility to offer targeted extra supplemental benefits or reduced cost sharing can lead to higher-quality, lower-cost care. According to CMS, the goals of the model are to improve health, reduce avoidable high-cost care, and reduce costs.

Value-Based Insurance Design (VBID) generally refers to efforts to structure cost-sharing and plan design elements to encourage enrollees to use high-value services—those services that have the greatest potential to positively impact enrollee health at a lower cost than alternatives.

The VBID model begins on January 1, 2017 and will focus on beneficiaries with diabetes, congestive heart failure, chronic obstructive pulmonary disease (COPD), past stroke, hypertension, coronary artery disease, mood disorders, and combinations of these categories. It will run for five years in Arizona, Indiana, Iowa, Massachusetts, Oregon, Pennsylvania, and Tennessee.

CMS recently announced planned updates to the model that will be implemented in the second year, starting January 1, 2018. In year two, CMS will expand the model to include beneficiaries with rheumatoid arthritis and dementia and add Alabama, Michigan, and Texas to the states where the model will take place.

When VBID was originally announced, Medicare Rights actively weighed in on the development of the model and submitted comments to CMS identifying components of the VBID model that Medicare Rights supports and relayed suggestions intended to strengthen the model and ensure that the proposed VBID demonstration fully meets the needs of Medicare beneficiaries. Medicare Rights welcomes the changes announced by CMS and continues to encourage the agency to actively engage consumer advocates in the program design, implementation, and evaluation as the VBID model is carried out.