VBID in TRICARE

Value-based insurance design looks to be expanding. As the American Journal of Managed Care reports: The bill calls for a pilot demonstrating the feasibility of incorporating VBID by “reducing co-payments or cost shares for targeted populations of covered beneficiaries in the receipt of high-value medications and services and the use of high-value providers” no later…

Do narrow networks reduce cost?

Many health plans in the Obamacare health insurance exchanges aim to keep premiums down by limiting patients to a select group of providers (e.g., hospitals, physicians). The thought is, by limiting patients to a “narrow network” of providers, patients are in essence restricted to see the most efficient providers.  Some may claim that “efficient” means high quality…

Is reducing disparity enough?

A recent paper in by Martin et al. (2015) finds that Medicaid Managed Care programs in Kentucky reduced monthly professional visits. Further, the decrease in the number of professional visits was larger for whites than for non-whites. The authors conclude: We find evidence that MMC [Medicaid Managed Care] has the possibility to reduce racial/ethnic disparities…

ACA and narrow networks

One way for insurers to reduce health care costs is to restrict patient access to only lower cost providers.  This phenomenon is known as narrow networks.  On the one hand, narrow networks can promote efficiency by driving down provider price and directing patients to the highest value physicians.  Alternatively, if insurers use narrow networks to direct patients…

The Next Generation ACO

Medicare currently has two Accountable Care Organizations (ACOs)–the more popular Medicare Shared Savings Program (MSSP) and the Pioneer ACO program. However, these ACOs have generated only limited cost savings. Only 11 of 23 Pioneer ACOs and 58 of 220 MSSP participants generated cost savings. To address some provider concerns and due to the limited cost…

A Medicaid ACO?

Medicare’s Shared Savings Program (MSSP) contracts with accountable care organizations (ACOs) to provide care for Medicare beneficiaries.  Reimbursement levels for these ACOs depends on quality and their ability to generate cost savings relative to the non-ACO national trend.  The goal is to align provider and payer incentives in improving quality and reducing cost. Would such a…