Value-based insurance design was created in 2005 to help change the focus in health care spending from how much we are spending to how well we are spending it. The idea is to set consumer cost-sharing based on how much healthier you become, not just on the actual cost of the care. This concept, included in the ACA and used by Medicaid and Medicare, has already touched 137 million Americans.
In this video, Dr. A. Mark Fendrick, professor of health management and policy at SPH and of internal medicine, U-M Medical School, explains value-based insurance design and how this relatively small center, driven largely by SPH students, has been able to have an impact, not only on the national health policy level, but right down to the level of individual patients, allowing them to get the care they need by the right provider and for the right price.