Value-based insurance design (VBID) offers members lower out-of-pocket costs for high-value services, and sometimes charges higher out-of-pocket costs for low-value services. Preventive services without cost sharing mandated by the Affordable Care Act is a good example of VBID. VBID is most prevalent in pharmacy benefit design. Our 2023 Best Practices in Healthcare survey shows that 51% of companies (and 56% of companies with over 1,000 employees) have a preventive drug list to bypass the deductible and provide first-dollar coverage in high-deductible health plans.
Research recently published in JAMA Health Forum compared the medical claims for 10,588 people with diabetes who had lower or no cost sharing for diabetes medicines with claims from almost 700,000 matched people with diabetes to assess the impact plan design on cost, medication use and quality of care. Their research included commercial claims data from 2004 to 2017, and data for each patient was available for the year before and the year after implementation of the VBID design.
The researchers found that complications of diabetes, such as bacterial infections, neurovascular events, acute coronary disease, and diabetic ketoacidosis, were statistically significantly lower in members with diabetes who had the VBID plan design. The entire population had 8.4% fewer diabetes complications. The impact was larger in those who lived in low-income zip codes, who had 10.2% fewer diabetes complications.
The study also found that those with access to diabetes medications without cost sharing used 11.3% more non-insulin drugs for diabetes; those who lived in low-income ZIP codes used 15.2% more non-insulin drugs for diabetes. This is consistent with other studies that show cost sharing leads to less drug adherence for those who have lower incomes.
The researchers didn't report on total costs for the cohort, so we don’t know if this plan design saved medical costs. A previous study showed that a VBID design with lower-cost drugs for a variety of conditions, including diabetes, didn't raise total costs of care.
Implications for employers:
Hepatitis C, a virus identified in 1989, is a leading cause of liver failure and liver cancer, and substantially increases the likelihood of premature death. It's spread through blood and bodily fluids, so many cases were from blood transfusions before 1989, although more recently most cases are associated with intravenous drug use and sexual transmission.
There are six different agents available for treating the various phenotypes of hepatitis C, with the prices for brands and authorized generics ranging from $25,000 to $90,000 per treatment course – with most coverage and utilization for the lower cost products.
Although an estimated 2.4 million in the U.S. have active hepatitis C, only 1 million have been treated since these drugs became available. As many as three-quarters of those with hepatitis C don’t know they are infected with the virus, making it more likely they will transmit it to sexual partners or other intravenous drug users. Cases of hepatitis C are rising, although we have effective drugs to treat the disease and prevent new cases.
Some employer-sponsored health plans restrict treatment for hepatitis C. For example, some require members seeking treatment to be drug-free and abstinent from alcohol. The current treatment guideline “strongly asserts that active or recent drug use or concern for reinfection is not a contraindication to [hepatitis C] treatment.” Unfortunately, these restrictions could mean those who are denied treatment are likely to spread hepatitis C to others. Eradication appeared to be in sight in the early 2010s, but now seems far away.
The Biden administration proposed a $12.3 billion program in the 2024 federal budget to eliminate hepatitis C by 2030, although it remains in gridlock. Researchers estimate that this program could avert 24,000 deaths and decrease total healthcare spending by $18.1 billion over 10 years.
Implications for employers:
Cervical cancer remains a major cause of death in young women, and head and neck cancer is a major cause of death in middle-aged and older people. Both are often caused by human papillomavirus (HPV), which is now a preventable disease.
A national study in Scotland showed that among the 29,555 girls vaccinated before age 13 in that country, none was diagnosed with cervical cancer over decades of observation. Cervical cancer was diagnosed in about 3.2 per 100,000 person years who were vaccinated at age 14 or later, and 8.4 per 100,000 person years in those who were unvaccinated. Vaccination rates in Scotland weren't related to wealth of place of residence, although those from more deprived areas benefited more from HPV vaccination.
The CDC recently reported that just 39% of U.S. children ages 9 to 17 had received “at least one vaccine.” HPV vaccination is now recommended up to age 45 for those who weren't vaccinated earlier. While some parents have been reluctant to vaccinate children for fear of tacitly approving sexual activity, research has shown that vaccination is not correlated with sexual activity among teens.
Many U.S. teens aren't gaining the benefit of protection against future cancer from HPV vaccines, and most who are vaccinated would benefit from being vaccinated earlier.
Jeff is an internal medicine physician and has led WTW’s clinical response to COVID-19 and other health-related topics. He has served in leadership roles in provider organizations and a health plan and is an Assistant Professor at Harvard Chan School of Public Health.
Employers are aligned on priorities over the next three years, even as they face complex needs, WTW survey finds
