Question

Explain the concept of value-based insurance designs. What might be some of the difficulties in implementing such designs?

Answer 1

"Value-based insurance design" aims to increase health care quality and decrease costs by using financial incentives to promote cost efficient health care services and consumer choices. Health benefit plans can be designed to reduce barriers to maintaining and improving health. By covering preventive care, wellness visits and treatments such as medications to control blood pressure or diabetes at low to no cost, health plans may save money by reducing future expensive medical procedures.

Difficulties in implementing such designs

Challenges are inherent in implementing V-BIDs, and difficulties arise in identifying the groups of diseases or individuals for which V-BID will result in cost savings.

1) V-BIDs also become challenging to implement when patients who are choosing among healthcare services and insurance plans have difficulty understanding their details and distinguishing which will be most beneficial to them.

2 Well-designed pilot projects are needed to see how various populations (ie, varying socioeconomic backgrounds, pre-policy adherence profiles) respond to and utilize V-BIDs in disease treatment.

3)Specifically, establishing price responsiveness for the treatment and management of various diseases, then applying the most effective pricing for deductible and co-pays, is imperative to optimize the outcome and proper application of any V-BID program.

4)Large insurers or firms can then tailor health plans to a particular employee or member with a particular disease and use innovative strategies to improve adherence in the program .

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