The Center for Medicare & Medicaid Innovation (CMMI) is now several months into the first year of implementation of the Medicare Advantage Value-Based Insurance Design (MA-VBID) model test, a pilot project measuring the potential for value-based insurance design (VBID) in the Medicare Advantage program.1, 2 In the model test, participating Medicare Advantage Organizations (MAOs), which ordinarily offer Medicare Advantage and Part D benefits to each of their enrollees in a plan uniformly at the same level of coverage and cost sharing, can offer extra coverage or reduced cost sharing specifically to enrollees with CMMI-specified chronic conditions, rather than to the plan’s membership at large.
Still, little is known about what disease conditions and value-based design approaches the MAOs participating in the model test have focused on in the first year of implementation. The Centers for Medicare & Medicaid Services (CMS) prohibits the MAOs from marketing their VBID benefits and has not released an authoritative compendium of the model test’s approaches.3 In addition, while CMS has generally identified the MAOs participating in the program, it has not specified the number of enrollees to which those MAOs may be offering extra coverage or reduced cost sharing.
The CMS Medicare Advantage Plan Benefit Package files, which contain data on each participating MAO’s VBID benefits, hold the answers to these questions. Manatt Health analyzed these files to determine which MAOs participated in the VBID model test and what value-based approaches are being used in their individual plans (also known as plan benefit packages (PBPs)) for which disease conditions. Our findings for CY 2017 show that MAO approaches to VBID focus on diabetes, congestive heart failure, chronic obstructive pulmonary disease and hypertension.
About 2% of All Medicare Advantage Enrollees Potentially Have Access to VBID Benefits in 2017.
In the first year of implementation, there are 11 MAOs participating in the model test by offering extra benefits or reduced cost sharing to their enrollees. Because two of them are under common ownership, these 11 represent nine unique corporate parent organizations. They are Aetna Inc., Fallon Community Health Plan, Geisinger Health System, Indiana University Health, Tufts Associated HMO, Inc., UPMC Health System, Highmark Health, Blue Cross and Blue Shield of Massachusetts, Inc. and Independence Health Group, Inc.4
The MAOs are concentrated geographically with five participating in Pennsylvania, three in Massachusetts and one in Indiana. There are no MAOs participating in Arizona, Iowa, Oregon or Tennessee, states from which CMS would have admitted MAOs to the test.5 The participating MAOs have collectively entered 45 plans (or PBPs) into the model test, which enroll 2% of Medicare Advantage enrollees nationally.6 The number of enrollees who actually enjoy VBID benefits will be substantially fewer. Only those enrollees with specific chronic conditions, and in some cases who earn benefits through participation in wellness programs, will actually get VBID benefits.
MAOs Are Mostly Focusing Their VBID Benefit Strategies on Enrollees With Diabetes, Congestive Heart Failure and Chronic Obstructive Pulmonary Disease or Comorbidities of These Conditions.
All but one participating MAO in 2017 focused on diabetes, congestive heart failure (CHF) or chronic obstructive pulmonary disease (COPD), in some combination, by offering VBID benefits to enrollees with those conditions. MAOs have a total enrollment of 308,096 enrollees in plans (or PBPs) offering VBID benefits focused on CHF either as a single condition or with a comorbidity; 299,995 enrollees in plans focused on COPD either as a single condition or with a comorbidity; and 235,031 enrollees in plans focused on diabetes either as a single condition or with a comorbidity. A single MAO with total enrollment of 46,137 in plans is offering VBID benefits focused on hypertension (HPN). Notably in this first year, none addressed patients with past stroke, coronary artery disease or mood disorders, though CMMI would have permitted these strategies. (See Table 1.)
Participating MAOs Are Mostly Reducing Cost Sharing for Medical Benefits.
In 36 of the 45 plans (or PBPs) in the model test, enrollees with chronic conditions receive reduced cost sharing for medical benefits, occasionally in combination with extra coverage of services or reduced cost sharing for Part D drugs. There are three plans (or PBPs) where extra coverage is the only VBID benefit, and six where reduced drug cost sharing is used alone. (See Table 2.)
Most MAOs Offering VBID Benefits Require Enrollees to Meet Some Prerequisite Beyond Having a Chronic Condition to Earn Those Benefits.
Approximately 57% of enrollees are in plans (or PBPs) where they must meet a prerequisite beyond merely having a chronic condition to earn VBID benefits. In every case, that prerequisite includes participation in some type of wellness program before earning benefits. The enrollees of one plan (or PBP) must also obtain their VBID benefits from a high-value provider network. (See Figure 1.)
Source: Manatt analysis of Plan Benefit Package Files for CY 2017 Note: Enrollment for each plan obtained from Medicare Advantage/Part D Contract and Enrollment Data for January of 2017. An MA-VBID plan is defined as every unique combination of a Medicare Contract and plan identifier that offers at least one VBID benefits package. VBID plans are identified by searching all VBID specific tables available in the 2017 PBP files. Enrollment represents the total number of beneficiaries that have access to a particular benefits package, rather than total beneficiaries that are actually using and/or qualify for a particular benefits package.
Overall, the MAOs participating in the first year of the MA-VBID model test are clustered geographically, and are largely focusing on the same disease conditions: diabetes, CHF and COPD, in some form. They have also largely chosen the same VBID benefit types: reduced medical cost sharing contingent on participation in a wellness program (though the specific VBID benefits offered may vary greatly from plan to plan). These MAOs are permitted to change their strategies in the second year. But many are expected to stay the course for at least two years, as CMMI has required that Year 2 (CY 2018) applications be submitted early in the first year of the test, before true implementation experience could accrue. Manatt Health expects CMMI to release data on Year 2 benefits in fall 2017, including information on new participants, if any. We will continue to monitor and analyze trends moving forward.