Evaluation of Phase II of the Medicare Advantage Value-Based Insurance Design Model Test

This report presents the RAND Corporation team's findings from its evaluation of Phase II of the Medicare Advantage (MA) Value-Based Insurance Design (VBID) model test, initiated by the Center for Medicare & Medicaid Innovation (CMMI), for the years 2020 and 2021. VBID allows participating MA parent organizations (POs) to offer supplemental benefits and financial and nonfinancial incentives to beneficiaries, hospice benefits (an MA hospice benefit, palliative care, transitional current care, and hospice supplemental benefits), and wellness and health care planning (WHP) through their MA plans. Some benefits may be targeted to beneficiaries with certain chronic conditions, or based on beneficiaries' socioeconomic status measured by qualification for the Medicare Part D low-income subsidy (LIS) or by dual eligibility for Medicare and Medicaid in territories where LIS is not available. Other VBID benefits must be offered to all beneficiaries within a VBID plan.

In this report, we describe findings from interviews with representatives of both participating and nonparticipating POs, vendors, and in-network and out-of-network hospices. We also report initial findings on the estimated association between VBID and a variety of key outcomes for 2020 and 2021, given data availability. We analyze outcomes including beneficiary participation, enrollment, bids, premiums, and projected costs of supplemental benefits to the Centers for Medicare & Medicaid Services (CMS). A separate appendix provides additional information on research questions, primary data collection and analysis, statistical approach, and other material. The results will be useful to multiple audiences, such as policymakers, health plans, and researchers interested in insurance benefit design.

A separate appendix provides additional information on research questions, primary data collection and analysis, statistical approach, and other material.