Man and woman speaking with doctor There is still unrealized opportunity to use value-based insurance design to impact the utilization of a wider array of high value, and low value, clinical services. (Photo: Shutterstock)

Do consumers really value items that cost money more than those that are free? One leading benefit design strategy hopes that when it comes to essential health care services, the answer is no. Value-based insurance design (VBID) removes or lowers financial barriers to high-value clinical services in hopes that this will make consumers more likely to seek them.

First theorized by University of Michigan faculty in 2005, the concept underpins much of what consumers may take for granted in their covered benefits, such as free annual physicals, but it has the potential to do so much more. Thus far, VBID programs have largely focused on waiving or lowering out-of-pocket costs for preventive services. The most prominent example is Section 2713 of the Affordable Care Act, which requires health plans to cover recommended primary preventive services (e.g., screening for depression, flu shots, all FDA-approved contraceptives) with no cost sharing.

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