CMS rolls out new value-based Medicare Advantage program

The Center for Medicare and Medicaid Services has rolled out a new Medicare Advantage Value-Based Insurance Design Model that will be tested in seven states starting in 2017 as a way to trim costs in the treatment of certain chronic conditions.

The new Medicare Advantage plan offers flexibility in extra supplemental benefits for enrollees with diabetes, congestive heart failure, chronic obstructive pulmonary disease, past stroke, hypertension, coronary artery disease, mood disorders and combinations of these categories, CMS stated. 

It gives health plans the flexibility to provide new supplemental benefits tailored to the enrollees' clinical needs, such as the elimination of copays for eye exams for beneficiaries with diabetes or extra tobacco cessation assistance for enrollees with COPD.

The model starts Jan. 1, 2017 and will run for five years in Arizona, Indiana, Iowa, Massachusetts, Oregon, Pennsylvania, and Tennessee. Upon approval from CMS, eligible Medicare Advantage plans in these states may offer enrollees varied plan benefit design. The goal is to improve beneficiary health, reduce the use of avoidable high-cost care and reduce costs for plans, beneficiaries and the Medicare program, according to CMS.

Value-Based Insurance Design refers to insurers' efforts to structure cost-sharing with patients to encourage them to use high-value clinical services, those that have the greatest potential to positively impact their health.

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These approaches are increasingly used in the commercial market, and evidence suggests they would work in health insurance benefit design, according to CMS.

The new model was developed by the CMS Innovation Center, which was created by the Affordable Care Act to test new healthcare payment methods to reduce costs while retaining quality of care.

CMS will hold a webinar introducing the model on Sept. 24.

Twitter: @SusanMorseHFN