On April 16, 2018, CMS officially published their new rule for the Medicare program contract year 2019.  This rule includes a reinterpretation of the Medicare Advantage (MA) uniformity requirement that will allow for more flexibility in benefit design for MA enrollees with specified chronic conditions.

Beginning in 2020, CMS will waive the uniformity requirement for MA plans that provide additional supplemental benefits to chronically ill enrollees.  This change paves the way for the further incorporation of V-BID principles into the Medicare Advantage program.  While the ongoing MA V-BID Model Test will continue, plans outside of the demo will now have the flexibility to offer V-BID benefit designs to their beneficiaries without being subject to the additional application and geographic limitations inherent to the model test.  Although the ability to lower cost-sharing for prescription drugs will remain a unique feature of the MA V-BID demo, the application of clinically nuanced V-BID strategies beyond the model test presents an enormous opportunity for the Medicare Advantage program.  V-BID can encourage the utilization of high-value providers and services, thus helping Medicare Advantage plans improve health and quality, enhance consumer engagement, and reduce costs.

Recent Updates

Value-Based Insurance Design in Medicare Advantage
In 2018, CMS increased the flexibility of benefit designs in Medicare Advantage by reinterpreting Uniformity Requirement (UR) rules under Medicare Advantage (MA). However, the new, universal flexibilities only apply to Part C benefits and excludes Part D benefits. MA plans that participate in the Medicare Advantage Value-Based Insurance Design (MA-VBID) demonstration project can alter cost-sharing for both chronic disease services and drugs. MA enrollees would be better off if the new, broad flexibilities were extended to Part D benefits, due to the strong evidence that value-based insurance design (VBID) reduces cost-related non-adherence, reduces out of pocket spending for vulnerable seniors, and improves health outcomes. This policy brief compares and contrasts the MA-VBID demo (including January 2019 updates) and the new UR flexibilities. We recommend extending new UR flexibilities to Part D benefits to fully empower MA organizations to improve benefits for their enrollees.