Revolutionizing US Healthcare With Consumer-Centered Care, Value-Based Insurance Design

Value in healthcare isn’t measured by the price consumers pay for treatment. Simply because a drug or procedure is expensive doesn’t guarantee that it will have a meaningful effect on an individual’s overall health. Steering the healthcare industry toward consumer-centered, value-based insurance design (VBID) would allow increased access to care, involve patients in more aspects of their treatment, and ensure consumers won’t be left paying extreme costs for high-value care while also allowing them to avoid low-grade, unnecessary treatment.

In an informative webinar on consumer-engagement in benefit design, presented by the Health Care Transformation Task Force (HCTTF), Hoangmai Pham, MD, MPH, vice president of provider alignment solutions at Anthem, discussed 6 guidelines that could engage consumers in benefit design and pave the way for healthcare reform. The presentation also outlined how VBID, a term coined by A. Mark Fendrick, MD, director of the V-BID Center at the University of Michigan and co-editor-in-chief of The American Journal of Managed Care®, can revolutionize modern healthcare.

The first guideline is that payers, providers, and purchasers “utilize modernized ways of obtaining consumer feedback. They should also offer effective decision-making support tools that help facilitate greater partnership with consumers,” Pham said. Patient input can help shape ways individuals interact with payers, leading to greater satisfaction among consumers and working towards facilitating their communication with providers.

The second guideline, according to Pham, advocates for the creation of high-performance networks. Data has shown that choosing proper health coverage remains a complicated process for American consumers leaving many consumers either paying too much for plans that they don’t need or choosing insufficient plans that can burden them with vast out-of-pocket expenses. Pham noted that high-performance networks emphasize upfront transparency, attempt to reduce health disparities, enable consumers to access services, create guardrails to protect medically complex patients, and coordinate coverage from medical care with behavioral health care. As a result, these high-performance networks can help consumers choose proficient, affordable plans to suit their specific needs.

The third guideline highlights the significance of communication and the importance of developing communication strategies to engage consumers.

“Consumers really need to receive the information they want and education to make informed decisions about their healthcare, as well as to navigate the challenges of their financial liabilities,” Pham said. “Providers, similarly, should be able to see and easily compare service costs at the point of care when they’re making those really critical decisions around prescriptions and referrals. And health plan designs really need to find ways to embed those benefit elements into clinical [electronic health] records so that they can more directly support decision making at the point of care.”

The fourth principle centers around accountability for insurance providers. According to Pham, it is important to seek to improve patient experience and outcomes, but someone needs to take responsibility, so those patients are not exposed to unnecessary risks.

“So, we believe that payers should certainly take on accountability for member experience at the enrollment and payment stages, as well as through activities such as medical management, but also that providers should have accountability at the care-delivery stage,” she said.

Establishing recognizable accountability can give patients peace-of-mind that their providers are managing their care and considering their best interests, Pham added.

With the fifth principle, Pham conveyed the importance of, “centering benefits to meet the needs of the individual.” She discussed the ways consumers can be motivated to establish a primary-care relationship and, “seek appropriate care, whether that be preventive, diagnostic, acute, or maintenance care from high-quality providers at the right place and time.”

She also expressed the benefits of using positive over negative reinforcement, which encourages consumers to establish and maintain strong primary care relationships. While creating an ideal network and benefit structure may be difficult to accomplish, changes in consumers’ perceptions of accessibility and amiability regarding care can propel them to seek treatment at appropriate intervals and serve as a preventative measure against excessive care.

The sixth, and final, guideline recognizes the importance of promoting people-centered health information technology. Currently, technology and consumer interfaces have much room for improvement, Pham said.

“They should really help nudge consumers toward high-value products and evidence-based decisions in a way that is user-friendly,” she said. “We believe that many designs need to be updated to reflect current consumer preferences and needs and that consumers want 2-way access to their own health data as an important tool for empowerment and activation.”

Pham was followed by Fendrick, who outlined how VBID can be used to reduce the total cost of healthcare. VBID is a personalized form of care that assesses an individual’s needs and aims to lower the total cost of care, compared with a traditional blunt-cost, volume-based system. Unfortunately, advancements in technology don’t always coincide with the way patients receive treatment. Dr. Fendrick explains that, “Where we’re going is Star Wars medicine and where we are now is Flintstones delivery.” Even though treatments may drastically improve, consumers may find difficulty accessing the care they need and also financing crucial services due to an inherently flawed healthcare system.

Determining the most useful preventive services, tests, procedures, and drugs specific to an individual encourages insurance companies to cover the most optimal forms of treatment with the greatest benefit for a patient’s overall health. For example, an expensive procedure that has a strong probability of dramatically improving a patient’s health, and reducing the need for more costly procedures in the future, will be completely covered by payers.

Fendrick realizes a major inconsistency affecting current healthcare derives from the way funds are distributed. “We’re lucky enough that there’s enough money in the healthcare system … we just spend it in the wrong places,” he says. Wasteful medical costs covered by both consumers and payers drives up the total cost of healthcare for everyone. Examples of low-grade services include lab testing before low-risk surgery, vitamin D screening, prostate-specific antigen screening for men over age 70, computerized imaging during the first 6 weeks of acute low back pain, and prescriptions for brand-name drugs when identical generics are available.

Regarding the true-value of care, Fendrick suggested that if patients lobby for unnecessary, low-grade services they should have to cover these costs themselves. Contrarily, expensive, high-grade services that offer a significant benefit toward a patient’s overall health should be completely covered by payers under a VBID model.

“Instead of what 80% of Americans see in terms of their cost-sharing, which is based on price, we set cost-sharing based on the clinical benefit, and we argue that there should be little or no out-of-pocket cost for high-value care, particularly those things that are deemed as quality metrics by health plans, and we should also make patients pay more out-of-pocket for the things that we shouldn’t be buying, those identified as a D rated service for the US Preventive Services Taskforce or, say, the Choosing Wisely initiative,” Fendrick said.

Americans, he said, don’t care about healthcare costs as much as they care about what their healthcare costs them. Unfortunately, solely decreasing out-of-pocket costs for individuals doesn’t solve the industry’s major problems. He advocated that implementing VBID offers a promising solution to reduce overall healthcare expenses.

However, making VBID a reality will require cooperation from all parties involved in the healthcare system. Patients must avoid opting for unnecessary care, providers must recommend services that will result in the greatest overall value, and payers must be willing to cover important, albeit costly services that could prevent the need for more care in the future. Fendrick challenged policy makers to consider VBID as a solution to problems encompassing the current healthcare system.

“I’d like you to leave this with you, as you do all your payment reform work, ask the question: are my patients aligned with this alternative payment model?” he asked.