Medicare has for many years used a fee for service Model to pay providers for covered health procedures. Through the VBID Model, CMS is testing a broad array of Medicare Advantage plan health plan innovations designed to enhance the quality of care for Medicare beneficiaries — including those with low income, as well as to reduce costs for enrollees and the overall Medicare program. As part of the Model test, MA plans offer additional supplemental benefits, reduced cost sharing, and/or rewards and incentives that are anticipated to improve health and health equity by offering items and services to meet health-related social needs, such as food and transportation, to engage enrollees in improving their care, by receiving high-value services or participating in health-related activities, and to reduce financial barriers to access.
For 2023, VBID Model participation continued to build on the substantial growth seen in the past two years and how have 52 participating Advantage plan organizations (MAOs), up from 34 in 2022. These 52 participating MAOs are testing the Model in 49 states, DC, and Puerto Rico through 1,368 plan benefit packages (PBPs), up from 448 PBPs participating in 45 states, DC, and Puerto Rico A total of 9.3 million beneficiaries are projected to be enrolled in participating plans in 2023, an increase from approximately 4.7 million beneficiaries in 2021. Over 6.0 million beneficiaries are projected to be offered additional supplemental benefits, and/or additional rewards and incentives, as part of the Model test in 2023.
The VBID Model began in January 2017 and will be tested through December 2024. The Model is designed to test whether furnishing certain flexibilities in coverage and payment for Medicare Advantage plans, to promote MA health plan innovations, would reduce Medicare program expenditures, enhance the quality-of-care Medicare beneficiaries receive, including dual-eligible beneficiaries, and improve the coordination and efficiency of health care service delivery.
Medicare recently announced a broad array of changes, including allowing MA plans to provide reduced cost sharing and additional benefits to enrollees based on chronic condition, socioeconomic status (as defined as being eligible for the LIS or, in US territories, being dual eligible), or both (even for non-primarily health related benefits), provide higher value Part C rewards and incentives, provide Part D rewards and incentives, and require participating plans to have a strategy to improve beneficiary wellness and health care planning. CMS was also required, through the Bipartisan Budget Act of 2018, to begin testing the Model in all 50 states and territories.
This year participants in the VBID Model also have the option of participating in a voluntary Health Equity Incubation Program. The goal of the Health Equity Incubation Program is to help drive a critical mass of interventions in the most promising focus areas (e.g., around addressing food and nutritional insecurity), optimizing design and implementation best practices for interventions focused on health equity, and building and sharing an evidence base for quality improvement and medical savings related to interventions that address health-related social needs.
CMS plans to publicly report on early impacts and experiences with the Model in the coming months.
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