Public Employee Advocate
April/May 2012

Feature Story

An ounce of prevention

Preventive healthcare saves Americans and employers money

LOST IN THE rancour over the individual mandate and the GOP’s belittling references to “Obamacare” are components of the Affordable Care Act that provide real-time health and financial benefits to Americans.

One such component requires health plans to cover recommended preventive services, such as cholesterol, blood pressure and diabetes screenings, for free to participants in “non-grandfathered” plans. (See definition on page 5.)

Experts on best practices in healthcare policy, healthcare financing and organizational productivity say free access to preventive care is a giant step toward holding the line on costs—and keeping people healthy.

It’s called “value-based insurance design” (V-BID), a concept introduced by researchers at the University of Michigan more than a decade ago.

“The basic V-BID premise is to align patients’ out-of-pocket costs, such as copayments and deductibles, with the value of health services,” says Dr. A. Mark Fendrick of the University of Michigan’s Center for Value-Based Insurance Design, in a September 2011 article for Kaiser Health News. “By reducing barriers to high-value treatments (through lower costs to patients) and discouraging low-value treatments (through higher costs to patients), these plans can improve health outcomes.”

An often-cited example of a high-value treatment is prescription statins for people with high cholesterol. Left untreated, high cholesterol can progress into coronary heart disease. It is much cheaper for health plans to subsidize the cost of the prescription than it is to pay for heart bypass surgery, experts say.

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