Value Base Insurance Coverage, it sounds so — valuable. But is it really valuable? Is Value Based Insurance Coverage (VBIC) what you really want — what you may need? Well, perhaps, that simply remains to be seen. As we move through the implementation of the Affordable Care Act, ObamaCare, VBIC will become the next big thing we need to pay close attention to. You can be sure that soon this item will be getting quite a bit of ink as the potential ramifications become apparent.
Like so many things in life, the reality of this “value” based system may be fraught with unintended consequences for the individual and massive values and benefits for hospitals, providers, insurers and the American government’s own pocket book. As has been seen repeatedly before, when these incentives are so stacked against the consumer, choices become limited.
While we have all heard the disingenuous dialogue over the ACA’s “Death Panels,” this is more the reality of what we can expect under ObamaCare. While insurance will now be broader in scope and cover many more diseases, conditions and treatments, the extent of coverage, location, provider choice and the options one will be able to find for treatment are where the real limits will be.
One of the main drivers for the rising cost of care is not the coverage that insures “Life” (survival), it is the coverage we increasingly demand for our on-going “Quality of Life” care. The large majority of the things that get paid for under insurance, and a significant piece of Medicaid and Medicare are no longer processes to keep us alive, but procedures to help us have a better quality of life. Most of these are not areas that in the long run will meet the coming “Price/Value” test for approved care. More and more of these procedures will be where we will find the expense is going to come out of our own pocket. And, as this number grows, a larger and larger percentage of the cost will shift from some other payer — i.e. the federal government, or other members of the insurance pool — to our own Health Savings (HSA) or bank accounts. This is one reason people are seeing the disheartening rising deductibles in the new health plans. We just can’t afford to pay for every procedure for all people; so either we limit the number of people or we limit the extent of the care they can get. Since we cannot socially stomach the idea of someone not getting care because of lack of money — regardless of the personal reason — we will be forced into a system that is limiting the kinds of care, or options, that we can receive under the societal dole.
In the, not so distant, future, you just may find that the cancer you have will still be removed under your health care plan, but the extensive remediation or cosmetic/reconstruction may not have the required price/value calculation and won’t be covered. That transplant you want, or that knee replacement, given your age is no longer cost justified under your insurance plan. You will be welcome to pay for the procedure out of pocket, and likely out of the insurance network, if you choose and if you have the cash, or a private policy.
One thing to note is that there is a limit on what you can bank in your Health Savings Account. As VBIC becomes our new reality, perhaps it’s time to demand a change to the current lifetime contribution limit mechanism — from a total of $3,250 for a single person and $6,450 for a family — to an annual contribution limit but no life-time cap. Maybe then we can pay for the things that we will no lover be eligible for under the VBIC system. As of 2013, the U.S. Treasury Department modified the prior “Use it-or-Lose it” rule and now graciously allow you to carry over up to $500.00 in your HSA per year. Not much help as we age and find fewer and fewer VBIC coverage options to maintain the quality of life we desire. You would think the government, “for the people” doesn’t really want you to have these options given these limits and the coming VBIC system of reimbursement. Maybe it’s time that “we the people” remind them that the government is also “of the people and by the people”, and demand this change.
In the end, mostly due to the math, this VBIC outcome is a certainty, the question simply becomes when it happens, not if!