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CMS Announces Strong Participation in Value-Based Medicare Advantage Model for CY 2020 and New Opportunities for CY 2021

CMS Announces Strong Participation in Value-Based Medicare Advantage Model for CY 2020 and New Opportunities for CY 2021

Innovations for 2020 enabled Medicare Advantage (MA) organizations to offer more benefits through the Value-Based Insurance Design (VBID) Model; MA organizations can now apply to participate in the Medicare Hospice benefit component for CY 2021

Today, the Centers for Medicare & Medicaid Services (CMS) released data on participation in the Medicare Advantage (MA) Value-Based Insurance Design (VBID) Model for Calendar Year (CY) 2020 as well as details on the Model application process for CY 2021. The VBID Model tests innovative strategies in MA plan design. Additionally, as previously announced in January 2019, today CMS is releasing a Request for Applications (RFA) for eligible MA plans to begin a test of allowing MA enrollees to access the Medicare hospice benefit through their MA plan beginning January 1, 2021. By reducing fragmentation and increasing financial accountability, CMS is enabling MA organizations to better coordinate palliative and hospice care for beneficiaries that choose MA.

In October 2019 President Trump issued an Executive Order on Protecting and Improving Medicare for our Nation’s Seniors. Through both today’s announcement and a future, separate RFA that CMS aims to release in January 2020 for other components of the VBID model for CY 2021, CMS is implementing key provisions of the President’s Executive Order. MA organizations will finalize their VBID plan designs for all components of VBID by the CY 2021 bid deadline of June 1, 2020.

“Hospice patients find themselves in a particularly vulnerable and difficult time, and the Trump Administration wants to make every provision possible to allow them to focus on their loved ones and their care, rather than government bureaucracy,” said CMS Administrator Seema Verma. “This Model is a vital element of that effort. By expanding benefits and coverage and igniting greater coordination, it promises to improve quality of care and quality of life for our nation’s seniors. The result of our efforts has been a dramatic increase of participation in the VBID Model and the value-based, coordinated care it can provide.”

CY 2020 VBID Model Participation

From day one, the Trump Administration has focused on providing additional flexibilities within the MA program, including through the VBID Model, to enable Medicare health plans to provide more choices and better care for beneficiaries.

CMS is today announcing that the number of MA enrollees in VBID-participating plan benefit packages (PBPs) more than tripled from 2019 to 2020, up to approximately 1.2 million beneficiaries in 2020. These over 1.2 million beneficiaries are enrolled in MA plans offered by 14 participating MA organizations across 30 states and Puerto Rico, up from only seven states in 2019. Additionally, CMS saw Dual-Eligible, Institutional, and Chronic Condition MA Special Needs Plans (SNPs) take advantage of being eligible to participate in the VBID Model in CY 2020.

CY 2021 Medicare Hospice Benefit

In January 2019, CMS announced an initiative to strengthen the Medicare hospice benefit by testing its inclusion in the MA benefit package through VBID for CY 2021. By fostering partnerships between hospice providers and MA organizations to deliver care for Medicare beneficiaries through the VBID Model, CMS is testing the impact of putting an end to the fragmentation in care and diluted financial responsibility that exists today in order to improve the quality of care that beneficiaries receive.

As recommended by the Medicare Payment Advisory Committee (MedPAC) and others, this Model test recognizes that the Medicare hospice benefit has not been significantly updated since it was added as a Medicare covered benefit 36 years ago. While the benefit has not been significantly updated, MedPAC notes that hospice spending has grown substantially - by more than 400 percent between 2000 and 2012 – with wide variation in utilization, as the average hospice length of stay has increased from 53 days to 89 days while the median length of stay has remained the same at about 17 days.

MedPAC, in its March 2019 Report to Congress, further stated that of the $17.9 billion spent on hospice services for 1.5 million beneficiaries in 2017, more than half - $10 billion - was spent on patients with stays exceeding 180 days.[1] At the same time, over 30 percent of beneficiaries electing hospice pass away after having been in hospice for less than seven days. With such divergent trends it is important to ensure that patients receive high quality care.

Additionally, for some beneficiaries, their families, and caregivers, the hospice care they receive is not meeting expectations. By reducing fragmentation and holding MA organizations accountable for the full scope of care provided to their enrolled beneficiaries, the hospice component of the VBID Model will help address these issues.

If beneficiaries elect the hospice benefit provided by their MA plan, they will maintain the broad access they have today to the complete Medicare hospice benefit covered by Medicare FFS, as well as additional access to palliative care services, transitional concurrent care services, and hospice-specific supplemental benefits to improve their quality of care as well as their quality of life.

CMS acknowledges and is thankful for the broad support, diverse perspectives, and stakeholder interest and expertise in testing the VBID Model.

Please see the fact sheet for more information on the VBID Model. The VBID model website is available here: or email


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[1] Medicare Payment Advisory Commission, Report to the Congress: Hospice Services (Washington: MedPAC, June 2019), Chap. 12.