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Covering alternative care
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December 27, 1999: 6:28 a.m. ET
Non-traditional offerings are on the rise, but access is not always easy
By Staff Writer Nicole Jacoby
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NEW YORK (CNNfn) - Massage. Chiropractic. Acupuncture.
For millions of American pain sufferers, these alternative therapies represent nothing short of a miracle. And slowly but surely, the gospel is spreading.
"If you place yourself in 1989 and look at what's going on now, it's truly an awesome shift," said John Weeks, healthcare consultant and publisher of the Integrator for the Business of Alternative Medicine. "What was then considered quackery or fraud... is now being viewed as a normal part of doing business among insurers and others in the delivery side of medicine."
The number of Americans who subscribe to alternative care has skyrocketed in the past decade, with an estimated $27 billion spent annually on acupuncture, chiropractic, massage, yoga, homeopathy and other non-traditional therapies.
An increasing number of state legislatures have begun to mandate insurance coverage for certain alternative treatments, especially chiropractic and acupuncture, and as many as two-thirds of healthcare providers now offer some sort of compensation for alternative or complementary therapies.
Unfortunately, there is less to many of these benefits than meets the eye.
"If you ask, 'Is my insurer or HMO likely to pay for the alternative service that I use for the condition for which I use it?' The answer is likely to be 'no,'" said Weeks.
The lack of evidence supporting significant cost savings, among other factors, has led many health providers to take a relatively cautious approach to alternative care.
Clamoring for alternatives
There is little question that increasing competition in the healthcare arena has forced many insurers to rethink their position on alternative medicine.
As widespread consumer use of alternative therapies, including chiropractic, massage and acupuncture, gave birth to a multibillion-dollar industry, healthcare providers had little choice but to recognize their customers' newfound priorities.
In a study by Sacramento, Calif.-based Landmark Healthcare, more than a third of HMOs surveyed said member and employer demand were the primary catalysts behind alternative benefit offerings. Legal requirements were also a strong compelling factor.
On the employer front, a booming economy and tight labor market -- especially in the competitive high-tech sector -- have compelled many companies to find new ways to attract highly sought-after workers. Coverage for alternative medicine has been just one of the many lifestyle incentives offered by these start-up employers.
"These companies are not expecting to cut costs, they're offering these benefits just to cut down on turnover, attract people and keep them," said Stephen Rosenberg, M.D., director at the consulting firm PricewaterhouseCoopers.
But many employees and consumers are beginning to realize that these benefits are rarely as extensive -- and, consequently, as useful -- as they might have hoped.
A closer look
While healthcare providers are certainly providing more alternative medicine offerings than ever before, the benefits often come with heavy conditions or in the form of discounts, rather than health coverage.
In many cases, acupuncturists, chiropractors, and massage therapists will offer their services at a reduced rate under a referral agreement with healthcare providers. Oxford Health Plans, Aetna U.S. Healthcare and Blue Cross Blue Shield are among the companies that offer such discount plans.
Other providers limit alternative care by placing strict limits on its use. Acupuncture, for instance, might only be covered for migraine headaches eight times a year, and only upon the referral of your primary care physician.
The resistance to more comprehensive coverage stems in part from an inability thus far to link alternative care to cost savings.
Although the validity of alternative medicine is definitely increasing in the medical community, hard data supporting its ability to lower costs is still somewhat meager. Paradoxically, hard facts are difficult to accumulate when healthcare companies send subscribers to alternative providers outside their own networks.
"It's almost impossible for them to figure out how much alternative care substitutes for conventional care," said Rosenberg. "Are people who use these therapies seeing their physicians for the same disorder? Are they seeing them less? Are they getting fewer tests?"
Furthermore, the majority of patients who seek out alternative care rarely share this information with their medical doctors, making data accumulation even more difficult.
However, even if cost-saving findings becomes more conclusive -- and many in the alternative care field are convinced they will -- companies may be slow to adopt alternative healthcare coverage because high turnover rates make long-term health investments a moot point for many employers.
"We have a very fragmented (healthcare) system. The money may be spent out of one pocket, but the savings could go into a different pocket," said Rosenberg.
Because U.S. workers change jobs so frequently, many employers see little advantage -- aside from recruiting and retention -- to investing in the long-term health of their staff.
"It's hard to convince employers and HMOs that they ought to invest in these benefits when the savings may be realized by the next employer (or next healthcare provider)," Rosenberg said. Appropriately, industries with traditionally lower turnover -- automakers, for instance -- have been much quicker to provide alternative care.
In fact, the track record of employers generally has been somewhat better than that of HMOs, in part because the perspective of the employers tends to be more macroeconomic.
"An employer views health decisions in terms of global costs, whereas an HMO is more likely just to look at medical costs," said Weeks. Unlike the insurer, the employer may be concerned with productivity, absenteeism and the costs of rehiring -- all of which benefit from better preventive healthcare and popular health offerings.
An 'alternative' future?
Despite these problems, the outlook for coverage of alternative care remains bright.
As more research supports the effectiveness of alternative medicine, healthcare providers may become more willing to offer less traditional choices to their customers, especially as cost-savings become more apparent.
Pharmaceuticals are especially well-positioned for this type of change, contends Weeks, as vitamins and other natural agents often offer the same benefits as those products manufactured by a drug company -- and at a lower cost.
The natural agent "may be the preferred option for a certain subset of patients and it saves the HMO money," said Weeks. Treatments for high cholesterol have already reached this stage, with widely researched alternative fish-oil products significantly less expensive than traditional synthetic medications, for instance.
Legal pressures are also likely to expand alternative health coverage, as lobbyists continue to push the issue onto the agenda of state lawmakers throughout the country.
But for alternative healthcare to become a true benefit that can be easily accessed by its subscribers, the cost concerns of healthcare providers will have to be legitimately addressed.
"If the evidence mounts about the effectiveness of these therapies, it will add to the momentum," said Rosenberg. "But somebody needs to resolve the turnover problem and more companies need to see actual savings."
But as a new generation gains control, initiatives in this direction are likely to increase.
"It's the baby boomers who truly created this movement," said Weeks. "As they take over decision-making roles at HMOs, the likelihood that they or their family members have actually used these services and benefited from them is pretty good." 
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