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Value-Based Insurance Design: Helping Employers Improve the Value of Health Care
Date:8/24/2009

WASHINGTON, August 24 /PRNewswire/ -- As members of Congress continue to debate proposals for health care reform, the National Pharmaceutical Council (NPC) has released a new report on an important approach being used by leading edge employers for improving patient health outcomes - Value-Based Insurance Design (VBID). Featuring case studies, the report takes a closer look at how VBID is helping employers nationwide "get more health out of every health care dollar."

The report, "Value-Based Insurance Design Landscape Digest," authored by Dr. A. Mark Fendrick, Co-Director of the Center for Value-Based Insurance Design at the University of Michigan, explains how companies are using VBID to lower or eliminate financial barriers to the purchase of "high-value" drugs or health care services with the intention of improving adherence to therapy and avoiding more expensive future medical costs, such as hospitalization. These benefit design changes are most often coupled with education and other strategies for consumer engagement in order to have maximum impact.

"Under a VBID program, the alignment of financial incentives - for patients and providers - encourages the use of high-value care, while discouraging the use of low-value or unproven services. Ultimately, this can produce more health at any level of health care expenditure," said Dr. Fendrick.

In the report, Fendrick explains how VBID encompasses several key principles: value equals the clinical benefit achieved for the money spent; health care services differ in the health benefits they produce; and the value of health care services depends upon the individual who receives them. The more clinically beneficial a therapy is for a patient, the lower the patient's cost share. Thus, VBID encourages the use of medically necessary therapies and services and reduces barriers to access for these services.

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SOURCE National Pharmaceutical Council
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