DOVER—The Annual Review of Carrier Progress Towards Meeting Affordability Standards has been released by the Office of Value-Based Health Care Delivery.

After establishing affordability standards in 2021 and 2022, the office collected data from insurance carriers regarding their projected compliance with affordability standards for 2023, which is the first year of affordability standard implementation.

“The statutory charge of the Office is to “reduce health-care costs by increasing the availability of high quality, cost-efficient health insurance products with stable, predictable, and affordable rates,” Insurance Commissioner Trinidad Navarro said. “I am pleased that overall, carriers project compliance with the affordability standards set by the Office.”

The 2023 projections show that carriers will increase their investment in primary care spending to 7% of their total medical spend, or $40 million, and will hit the mandated 8.5% of total spend toward primary care programs that have engaged in care transformation activities. 

This results in an $8 million increase from 2022.  Additionally, carriers were required to limit price growth for hospital and other non-professional services increases to 5.5%. All carriers project compliance for each of the three required service categories – inpatient hospital, outpatient hospital and other medical.

A key finding of the report is that these limits saved Delawareans an estimated $2 million to $12 million in 2023, depending on the price increases hospitals would have otherwise negotiated with carriers. 

Critical to successful implementation of value-based care delivery programs are carriers non-fee-for-service reimbursement to primary care providers. Compliance with the affordability standards does not require carriers to increase payment equally across all providers, and the increased investment leans toward larger practices already engaged in care transformation activities. 

Projections for 2023 show that on a per-member-per-month basis, primary care investment has increased from $11 per-member-per-month in 2022 to $29 per-member-to-month in 2023 for practices engaged in value-based care programs.

The office is working on a supplemental report which will further explore challenges and opportunities related to value-based health care.