New Medicare Payment Models

Medical Billing

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The Centers for Medicare and Medicaid (CMS) released two new voluntary payment models for Medicare Advantage and/or Medicare Part D plans to further the value-based payment agenda. Both will run from 2020 through 2024.

Updated VBID

The first model is an updated version of the Value-Based Insurance Design (VBID) model. To reduce Medicare expenditures, increase the quality of care for Medicare beneficiaries, and improve efficiency, the CMS is testing this VBID model. This updated model extends access to Medicare Advantage (MA) plans to all 50 states. The eligible plan types are expanded to include Regional Preferred Provider Organizations and all Special Needs Plans (Chronic Condition SNPs, Dual Eligible SNPs, and Institutional SNPs).

The application period for 2020 is open now through March 1, 2019. Eligible clinicians can apply to test one or more of the new interventions:

  • Value-Based Insurance Design by Condition, Socioeconomic Status, or both
  • Medicare Advantage and Part D Rewards and Incentives Programs
  • Telehealth Networks
  • Wellness and Health Care Planning

Part D Payment Modernization

The second model is called Part D Payment Modernization. Patients, providers, and plans that choose drugs with lower price lists receive incentives through this five-year model. This model is created to test the revised Part D program and incentives on all Part D prescription drug spending and beneficiary costs. It is hoped that this model will reduce Medicare expenditures while maintaining quality care. Prescription Drug Plans and Medicare Advantage-Prescription Drug Plans are eligible. At this time, the application is open only for the calendar year 2020. However, the CMS may offer more application periods in the future depending on the success of the model.

For more information about these new payment models, visit:

MA Value-Based Insurance Design Model

Part D Payment Modernization Model


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