Dr Michael Chernew Foresees More Experimentation With VBID Principles

By 2020, more plans will incorporate value-based insurance design (VBID) principles as a way to lower cost sharing for high-value services and potentially increase cost sharing for low-value services, according to Michael E. Chernew, PhD, the Leonard D. Schaeffer Professor of Health Care Policy and director of the Healthcare Markets and Regulation Lab in the Department of Health Care Policy at Harvard Medical School.

Transcript (slightly modified)

What do you think the value-based insurance landscape will look like in 2020?

The challenge that we basically have in the healthcare system now is that spending is rising very rapidly. And one of the responses to rapidly increasing healthcare spending is to make the patient pay more out of pocket when they are purchasing their medications, when they are going to a physician’s offices or anything like that. The problem with making patients pay more out of pocket is that it discourages the use of high-value services, and it also makes the sick patients pay more in some ways for things that we want them to get, for those important quality services that they need.

So what I believe will happen when we get to 2020 is as the pressures on cost sharing increase, there’ll be a growing need to find ways to protect people who need to use the highest-value services from the costs of that cost sharing. So I suspect by 2020 there will be more, and more nuanced, health plans that incorporate the components of value-based insurance design in them. We’ve started largely in areas like diabetes, I think we’ll expand the number of clinical areas we’re in. We’ve started largely in lowering cost sharing for high value things, which I think will continue but I think will also potentially see increased cost sharing for low value services.

I believe the number of plans, plans on the exchanges, for example, commercial plans, will experiment more with value-based insurance design. I don’t see explosive growth, but I see steady growth and steady expansion in the penetration of programs that incorporate the principles of value-based insurance design.