Health Plan Participation in Hospice VBID to Shrink in 2024

Health plan participation in the hospice component of the value-based insurance design model (VBID) will fall in 2024.

For calendar year 2024, 13 Medicare Advantage Organizations (MAOs) will participate in the program’s hospice component, providing coverage through 78 health plans in 19 states. In 2023, 15 MAOs participated in hospice VBID, including 119 health plans in 23 states.

The hospice portion, often called the Medicare Advantage carve-in, is one component of the larger VBID demonstration that includes providers from across the continuum.

The complexity of weaving together the hospice care model and MA payment systems could be impacting participation, according to Fred Bentley, managing director for ATI Advisory’s Medicare Innovation Team.

“It’s been a rocky road. With any new demonstration program that involves a part of the health care sector that really had no interaction with managed care for decades, there’s going to be challenges,” Bentley told Hospice News. “For them to start negotiating with Medicare Advantage plans, who at the same time are learning about a very unique and very different type of benefit, there would be challenges in terms of what’s covered and what is not; who’s in and who’s out; and how plans pay for this.”

Geographically, hospice VBID will be available in 690 counties in 2024, down from 806 this year.

The decline in the hospice component comes even as the overall VBID program continues to grow.

As a whole, VBID will have 69 MAO participants in 2024, up from 52 in 2023. Those organizations are testing the model in 49 states, the District of Columbia and Puerto Rico through 1,528 health plans. This year, 1,367 plans offered coverage through VBID.

The 2024 participants will cover a combined 12.4 million Medicare beneficiaries next year, up from 9.2 million in 2023.

Launched in 2017, the VBID demonstration is testing new approaches to reimbursement across a variety of health care settings. The Center for Medicare and Medicaid Innovation (CMMI) launched the hospice component in 2021, representing the most significant step to date in moving hospice towards value-based payment models. 

Originally slated to end in 2024, CMMI has extended the program through 2030.

The demonstration involves greater levels of financial risk than hospices are accustomed to through the traditional Medicare Hospice Benefit. The program also experiments with tying payment to providers’ performance against certain metrics.

“In participating in this voluntary model component, MAOs are incorporating the Medicare hospice benefit into MA covered benefits while offering comprehensive palliative care services outside the hospice benefit for enrollees with serious illnesses,” CMMI indicated in a fact sheet. “In addition, participating MAOs are able to provide individualized, clinically appropriate transitional concurrent care through in-network providers and offer hospice-specific supplemental benefits.”