PERSPECTIVE: A Path to Value-Based Insurance Design for Mental Health Services.

BACKGROUND: Aligning cost of mental health care with expected clinical and functional benefits of that care would incentivize the delivery of high value treatments and services. In turn, ineffective or untested care could still be offered but at costs high enough to offset the delivery of high value care. AIMS: The authors comment on Benson and Fendrick's paper on Value-Based Insurance Design (VBID) for mental health in the September 2023 special issue of this journal. The authors also present a preliminary framework of key ingredients needed to consider VBID for mental health treatments and services. METHODS: The authors briefly review current and past efforts to contain costs and improve quality of mental health care, which include (for example) use of carve-out and carve-in programs, evaluation of cost sharing models, impact of accountable care organizations, and studying other benefit designs and impact of federal and state policies. RESULTS: Using PTSD as an example, key ingredients of VBID for mental health services were identified and include the following: tools for case identification and monitoring progress over time at the population level; specific treatments and services with evidence of clinical effectiveness, cost-effectiveness, and health equity; and an approach to document the specific treatment or service was delivered (versus another treatment or service that may lack evidence). DISCUSSION: The inability to afford mental health care is a top barrier to treatment seeking. People who do elect to spend time and money on mental health care are further disadvantaged by accessing care that is not well regulated and the quality at best is questionable. VBID could be an important lever for increasing access to and use of high value mental health care. Partnerships among the research, practice, and policy communities can help ensure research solutions meet needs of these two communities. IMPLICATIONS FOR HEALTH CARE: VBID holds promise to make high value mental health care more affordable while discouraging low value treatments and services. IMPLICATIONS FOR HEALTH POLICIES: While evidence gaps remain, these gaps can be filled concurrently with pursuit of VBID for mental health services. IMPLICATIONS FOR FUTURE RESEARCH: This paper identifies important research opportunities to help make VBID a reality for mental health care.

Evaluation of claims data from a commercial value-based insurance product shows pediatric imaging is not a major driver of overall or pediatric healthcare expenditures.

BACKGROUND: Initiatives to reduce healthcare expenditures often focus on imaging, suggesting that imaging is a major driver of cost. OBJECTIVE: To evaluate medical expenditures and determine if imaging was a major driver in pediatric as compared to adult populations. METHODS: We reviewed all claims data for members in a value-based contract between a commercial insurer and a healthcare system for calendar years 2021 and 2022. For both pediatric (<18 years of age) and adult populations, we analyzed average per member per year (PMPY) medical expenditures related to imaging as well as other categories of large medical expenses. Average PMPY expenditures were compared between adult and pediatric patients. RESULTS: Children made up approximately 20% of members and 21% of member months but only 8-9% of expenditures. Imaging expenditures in pediatric members were 0.2% of the total healthcare spend and 2.9% of total pediatric expenditures. Imaging expenditures per member were seven times greater in adults than children. The rank order of imaging expenditures and imaging modalities was also different in pediatric as compared to adult members. CONCLUSION: Evaluation of claims data from a commercial value-based insurance product shows that pediatric imaging is not a major driver of overall, nor pediatric only, healthcare expenditures.

Value-Based Insurance Design: Clinically Nuanced Consumer Cost-Sharing for Mental Health Services.

BACKGROUND: While consumer cost-sharing is a widely used strategy to mitigate health care spending, numerous studies have demonstrated that even modest levels of out-of-pocket cost are associated with lower use of medical care, including clinically necessary, high-value services. Within mental health care, increases in cost-sharing are associated with reductions in use of mental health care and psychotropic medication use. Further, these reductions in mental health services and treatments can lead to downstream consequences including worsening of psychiatric illness and increased need for acute care and psychiatric hospitalization. Thus, there is a need for clinically informed solutions that explicitly balance the need for appropriate access to essential mental health services and treatments with growing fiscal pressures faced by public and private payers. Value-Based Insurance Design (VBID) describes a model where consumer cost-sharing is based on the potential clinical benefit rather than the price of a specific health care service or treatment. AIMS OF THE STUDY: Describe value-based insurance design and applications in mental health care. RESULTS, DISCUSSION AND IMPLICATIONS FOR HEALTH POLICIES: For over two decades, clinically nuanced VBID programs have been implemented in an effort to optimize the use of high-value health services and enhance equity through reduced consumer cost-sharing. Overall, the evidence suggests that VBID has demonstrated success in reducing consumer out-of-pocket costs associated with specific, high value services. By reducing financial barriers to essential clinical services and medications, VBID has potential to enhance equity. However, the impact of VBID on overall mental health care spending and clinical outcomes remains uncertain.

Out-of-Pocket Spending for Non-Birth-Related Hospitalizations of Privately Insured US Children, 2017 to 2019.

Importance: Privately insured US children account for 40% of non-birth-related pediatric hospitalizations. However, there are no national data on the magnitude or correlates of out-of-pocket spending for these hospitalizations. Objective: To estimate out-of-pocket spending for non-birth-related hospitalizations among privately insured children and identify factors associated with this spending. Design, Setting, and Participants: This study is a cross-sectional analysis of the IBM MarketScan Commercial Database, which reports claims from 25 to 27 million privately insured enrollees annually. In the primary analysis, all non-birth-related hospitalizations of children 18 years and younger from 2017 through 2019 were included. In a secondary analysis focused on insurance benefit design, hospitalizations that could be linked to the IBM MarketScan Benefit Plan Design Database and were covered by plans with a family deductible and inpatient coinsurance requirements were analyzed. Main Outcomes and Measures: In the primary analysis, factors associated with out-of-pocket spending per hospitalization (sum of deductibles, coinsurance, and copayments) were identified using a generalized linear model. In the secondary analysis, variation in out-of-pocket spending was assessed by level of deductible and inpatient coinsurance requirements. Results: Among 183 780 hospitalizations in the primary analysis, 93 186 (50.7%) were for female children, and the median (IQR) age of hospitalized children was 12 (4-16) years. A total of 145 108 hospitalizations (79.0%) were for children with a chronic condition and 44 282 (24.1%) were covered by a high-deductible health plan. Mean (SD) total spending per hospitalization was $28 425 ($74 715). Mean (SD) and median (IQR) out-of-pocket spending per hospitalization were $1313 ($1734) and $656 ($0-$2011), respectively. Out-of-pocket spending exceeded $3000 for 25 700 hospitalizations (14.0%). Factors associated with higher out-of-pocket spending included hospitalization in quarter 1 compared with quarter 4 (average marginal effect [AME], $637; 99% CI, $609-$665) and lack of chronic conditions compared with having a complex chronic condition (AME, $732; 99% CI, $696-$767). The secondary analysis included 72 165 hospitalizations. Among hospitalizations covered by the least generous plans (deductible of $3000 or more and coinsurance of 20% or more) and most generous plans (deductible less than $1000 and coinsurance of 1% to 19%), mean (SD) out-of-pocket spending was $1974 ($1999) and $826 ($798), respectively (AME, $1123; 99% CI, $1069-$1179). Conclusions and Relevance: In this cross-sectional study, out-of-pocket spending for non-birth-related pediatric hospitalizations were substantial, especially when they occurred early in the year, involved children without chronic conditions, or were covered by plans with high cost-sharing requirements.

Association of Participation in a Value-Based Insurance Design Program With Health Care Spending and Utilization.

Importance: Value-based insurance design (VBID) has mostly been used in improving medication use and adherence for certain conditions or patients, but its outcomes remain uncertain when applied to other services and to all health plan enrollees. Objective: To determine the association of participation in a California Public Employees' Retirement System (CalPERS) VBID program with its enrollees' health care spending and utilization. Design, Setting, and Participants: A retrospective cohort study with difference-in-differences propensity-weighted 2-part regression models was performed in 2021 to 2022. A VBID cohort was compared with a non-VBID cohort both before and after VBID implementation in California in 2019 with 2 years' follow-up. The study sample included CalPERS preferred provider organization continuous enrollees from 2017 through 2020. Data were analyzed from September 2021 to August 2022. Exposures: The key VBID interventions include (1) if selecting and using a primary care physician (PCP) for routine care, PCP office visit copayment is $10 (otherwise, PCP office visit copayment is $35 as for specialist visit); and (2) annual deductibles reduced by a half through completion of the following 5 activities: annual biometric screening, influenza vaccine, nonsmoking certification, second opinion for elective surgical procedures, and disease management participation. Main Outcomes and Measures: The primary outcome measures included annual per member total approved payments for multiple inpatient and outpatient services. Results: The 2 compared cohorts of 94 127 participants (48 770 were female [52%]; 47 390 were younger than 45 years old [50%]) had insignificant baseline differences after propensity-weighting adjustment. The VBID cohort had significantly lower probabilities of inpatient admissions (adjusted relative odds ratio [OR], 0.82; 95% CI, 0.71-0.95), and higher probabilities of receiving immunizations (adjusted relative OR, 1.07; 95% CI, 1.01-1.21) in 2019. Among those with positive payments, VBID was associated with higher mean total allowed amounts for PCP visits in 2019 and 2020 (adjusted relative payments ratio, 1.05; 95% CI, 1.02-1.08). There were no significant differences for inpatient and outpatient combined totals in 2019 and 2020. Conclusions and Relevance: The CalPERS VBID program achieved desired goals for some interventions with no added total costs in its first 2 years of operation. VBID may be used to promote valued services while containing costs for all enrollees.

Cost standard set program: moving forward to standardization of cost assessment based on clinical condition.

This communication piece is reporting the launching of the International Cost Standard set program, aiming to introduce standardized frameworks to measure costs for specific clinical conditions worldwide. A scientific committee including 16 international healthcare cost assessment experts from several countries, and International Consortium for Health Outcomes Measurement was formed to introduce the program. The committee got together in Lisbon for a first scientific meeting, followed by an international conference where time-driven activity-based costing applied studies were shared with the community. The cost standard set program start to offer instruments for people to measure with real-world data, the financial impact of having access to health technologies, improving the ability to evaluate inequity. Those advances might represent a paradigm shift in our ability to generate cost information on an individual level.

Value-Based Insurance Design: Clinically Nuanced Consumer Cost Sharing to Increase the Use of High-Value Medications.

Consumer cost sharing is widely employed by payers in the United States in an effort to control spending. Most cost-sharing strategies set patient contributions on the basis of costs incurred by payers and often do not consider medical necessity as a coverage criterion. Available evidence suggests that increases in cost sharing worsen health disparities and adversely affect patient-centered outcomes, particularly among economically vulnerable individuals, people of color, and those with chronic conditions. A key question has been how to better engage consumers while balancing appropriate access to essential services with increasing fiscal pressures. Value-based insurance design (VBID) is a promising approach designed to improve desired clinical and financial outcomes, in which out-of-pocket costs are based on the potential for clinical benefit, taking into consideration the patient's clinical condition. For more than two decades, broad multistakeholder support and multiple federal policy initiatives have led to the implementation of VBID programs that enhance access to vital preventive and chronic disease medications for millions of Americans. A robust evidence base shows that when financial barriers to essential medications are reduced, increased adherence results, leading to improved patient-centered outcomes, reduced health care disparities, and in some (but not most) instances, lower total medical expenditures.

Can Alternative Payment Models And Value-Based Insurance Design Alter The Course Of Diabetes In The United States?

Diabetes process and outcome measures are common quality measures in payment reform models, including Alternative Payment Models (APMs) and value-based insurance design (VBID). In this commentary we review evidence from selected research to examine whether these payment models can improve the value of diabetes care. We found that higher-risk APMs yielded greater improvements in diabetes process measures than lower-risk APMs, and that VBID models appeared to improve medication adherence but not other quality measures. We argue that these models are promising first steps in redesigning the payment system to improve diabetes care. However, greater coordination and alignment across models is needed to enhance their impact on providers' behavior, diabetes care processes, and patient health outcomes.

The Effect of the Medicare Advantage Value-Based Insurance Design Model Test on Utilization in 2017.

In 2015, the Centers for Medicare and Medicaid Services announced the Medicare Advantage (MA) Value-Based Insurance Design (VBID) model test, which allows MA insurers to use flexible benefit design strategies, such as reduced cost-sharing, to encourage beneficiaries with chronic disease to use high-value care. During the first year of implementation (2017), nine MA insurers offered VBID in 45 health plans to a total of 96 053 eligible beneficiaries. We used MA encounter data to estimate the impact of VBID on health services utilization in 2017 using a difference-in-differences research design. We found that VBID increased use of 10 out of 18 targeted services, and led to general increases in primary care visits, specialty care visits, and drug fills across eligible beneficiaries. The model was also associated with increases in ambulatory care sensitive inpatient and emergency department visits, an unanticipated effect that may be temporary. Overall, our findings suggest that VBID successfully increased the use of high-value services among eligible MA beneficiaries, an important first step along the pathway to better chronic disease management, lower spending, and improved beneficiary health.

Lessons learned from value-based pediatric appendectomy care: A shared savings pilot model.

PURPOSE: We aim to assess the healthcare value achieved from a shared savings program for pediatric appendectomy. METHODS: All appendectomy patients covered by our health plan were included. Quality targets were 15% reduction in time to surgery, length of stay, readmission rate, and patient satisfaction. Quality targets and costs for an appendectomy episode in two 6-month performance periods (PP1, PP2) were compared to baseline. RESULTS: 640 patients were included (baseline:317, PP1:167, PP2:156). No quality targets were met in PP1. Two quality targets were met during PP2: readmission rate (-57%) and patient satisfaction. No savings were realized because the cost reduction threshold (-9%) was not met during PP1 (+1.7%) or PP2 (-0.4%). CONCLUSIONS: Payer-provider partnerships can be a platform for testing value-based reimbursement models. Setting achievable targets, identifying affectable quality metrics, considering case mix index, and allowing sufficient time for interventions to generate cost savings should be considered in future programs.

Enhanced recovery in liver transplantation: A value-based approach to complex surgical care.

BACKGROUND: Value-based healthcare focuses on improving outcomes relative to cost. We aimed to study the impact of an enhanced recovery pathway for liver transplant recipients on providing value. METHODS: In total, 379 liver recipients were identified: pre-enhanced recovery pathway (2017, n = 57) and post-enhanced recovery pathway (2018-2020, n = 322). The enhanced recovery pathway bundle was defined through multidisciplinary efforts and included optimal fluid management, end-of-case extubation, multimodal analgesia, and a standardized care pathway. Pre- and post-enhanced recovery pathway patients were compared with regard to extubation rates, lengths of stay, complications, readmissions, survival, and costs. RESULTS: Pre- and post-enhanced recovery pathway recipient model for end-stage liver disease score and balance of risk scores were similar, although post-enhanced recovery pathway recipients had a higher median donor risk index (1.55 vs 1.39, P = .003). End-of-case extubation rates were 78% post-enhanced recovery pathway (including 91% in 2020) versus 5% pre-enhanced recovery pathway, with post-enhanced recovery pathway patients having decreased median intraoperative transfusion requirements (1,500 vs 3,000 mL, P < .001). Post-enhanced recovery pathway recipients had shorter median intensive care unit (1.6 vs 2.3 days, P = .01) and hospital stays (5.4 vs 8.0 days, P < .001). Incidence of severe (Clavien-Dindo ≥3) complications during the index hospitalization were similar between pre-enhanced recovery pathway versus post-enhanced recovery pathway groups (33% vs 23%, P = .13), as were 30-day readmissions (26% vs 33%, P = .44) and 1-year survival (93.0% vs 94.5%, P = .58). The post-enhanced recovery pathway cohort demonstrated a significant reduction in median direct cost per case ($11,406; P < .001). CONCLUSION: Implementation of an enhanced recovery pathway in liver transplantation is feasible, safe, and effective in delivering value, even in the setting of complex surgical care.