Part I: Why Doesn’t Insurance Cover Natural Medicine?
It’s a question patients ask us all the time: Why doesn’t insurance cover natural medicine? Because this is such an in-depth and critical issue, we will examine it in a four-part series. In Parts I and II of this series, we will examine the practical barriers to insurance coverage; in Part III, we will examine the political barriers; and in Part IV, we will examine the pros and cons of having insurance companies cover natural medical treatments, and whether it is in the best interest of patients.
The United States spends about $1.5 trillion on health care each year. About one-fifth of Americans believe the health system could be improved, and almost everyone in the remaining four-fifths feels it should be revamped altogether. As a result of this dissatisfication, four out of ten U.S. adults go outside the health system to use complementary, natural, or alternative therapies. Some 600 million visits to these practitioners are made each year (which surpasses that made to conventional medical practitioners), and patients pay an estimated $30 billion out of their own pockets for such non-traditional care per year.
Currently, there is some insurance coverage for alternative therapies such as chiropractic visits and acupuncture, but the prevalence of this type of coverage is no where near that of conventional treatments. Usually large employers (with more than 20,000 employees) are more likely to offer access to these non-traditional practitioners than medium or small employers. This coverage usually exists in 4 forms: (1) as a rider or supplement to the basic benefit package, which will often contain strict controls on its usage; (2) as a discount program where covered employees pay out of pocket but are eligible for discounts off fees or products (usually tied to an approved network of non-traditional practitioners); (3) as a defined, core benefit, which is managed by: limiting the type of non-traditional services covered (usually to chiropractic and acupuncture), requiring pre-authorization or referral by a primary care physician, or setting visit or dollar limits and higher co-payments than that for routine physician visits; and (4) as a benefit account, which typically has an annual dollar amount. But this coverage excludes a vast number of treatments, including almost all of natural medicine, in addition to the fact that those services that are covered are extremely limited and restricted.
If consumer demand for natural medicine and alternative therapies is so high, why the big hold up? Why isn’t natural medicine covered by insurance already?
The White House Commission on Complementary and Alternative Medicine Policy (WHCCAMP) was formed in March of 2000 to address, among other things, issues related to access and delivery of CAM (complementary and alternative medicine). The 20-member Commission was established by the President’s Executive Order No. 13147, and its primary task is “to provide, through the Secretary of Health and Human Services, legislative and administrative recommendations for ensuring that public policy maximizes the potential benefits of CAM therapies to consumers.”
The Commission held a series of ten meetings in and around Washington D.C. over a span of two years. At these meetings, clinicians, researchers, medical educators, regulatory officials, policymakers, practitioners, and others were asked to provide recommendations regarding Federal policies related to CAM. The Commission also solicited public testimony during a series of Town Hall meetings around the country. Overall, the Commission heard from approximately 1700 consumers, professional groups, societies, and health care organizations. They also visited several medical institutions and CAM clinics throughout the country. One of the public policy issues examined by the Commission was coverage and reimbursement of CAM.
The Commission identified several barriers to coverage inherent in the healthcare industry. First, insurance and managed care executives interviewed by the Commission indicated that CAM therapies are not covered because there is a lack of evidence supporting their “medical effectiveness.” The current climate of “runaway care,” rising healthcare costs, and the constant stream of new technologies and drugs has left decision-makers in the insurance equation cautious about expanding any healthcare benefits. They are “concerned that their limited dollars be spent on care that has been shown to be safe and effective.”
But to say that more research is needed on the safety and effectiveness of CAM is an over-simplification of the issue and does not even begin to address the underlying practical and theoretical problems involved. Admittedly, the body of research supporting the effectiveness of CAM is not as extensive as that supporting conventional therapies. But this fact is not surprising given the astronomical costs associated with such research, which are costs that are more easily shouldered by pharmaceutical companies (that have direct financial interests) than by the multitude of individual practitioners that make up the hugely diverse field of CAM. While the industry average might be $30 billion, the industry itself is made up of everyone from internet peddlers to legitimate practitioners. Meanwhile, single pharmaceutical companies, such as Pfizer, report revenues well-above CAM’s entire industry average.
The economic barrier aside, another related barrier to this lack of research is that no universal theoretical model currently exists as to how to integrate CAM with conventional therapies. While the Commission’s recommendation is that research be conducted to compare conventional and CAM approaches for the same condition, to test the effectiveness of individual and combined CAM treatments, and to test CAM treatments offered in conjunction with conventional therapies, there is no consensus or universal “standard of care” within the diverse CAM world as to treatment or integration. In other words, there is no readily available design for a CAM benefit model. Before the process could even begin, CAM practitioners would have to sit down and reach a consensus on which therapies should even be included as the subject of research for treatment of a particular condition, and how such therapies would be integrated with conventional treatments for that particular condition, which would be no easy task. And a consensus would also have to be reached regarding the research methodologies that would be used to evaluate the effectiveness of CAM treatments. While the classic evaluation of the effectiveness of treatment focuses on “response,” or alterations in physical condition, this marker can ignore the serious impairment that such treatments can have on patients’ quality of life or even length of life, such as with cancer treatment, for example. In contrast, CAM often places equal emphasis on the total effect that treatments have on patients, including patient comfort, functionality, energy, sleep quality, pain, and mood. Would the criteria used to assess the effectiveness of conventional medicine be expanded to include CAM’s criteria regarding quality and length of life? Or would CAM treatments, which often operate from a different clinical paradigm, be squeezed into a conventional model in determining which treatments should be included in coverage?
Another related issue would be how the safety of CAM treatments would be assessed for the purpose of including them in coverage. CAM therapies and conventional therapies are held to different standards, and any examination of the safety of CAM treatments would most likely be subject to much more scrutiny than conventional treatments. Currently, more than 100,000 Americans die each year from complications caused by prescription drugs being used as intended, and more than 2 million are hospitalized with such complications. But the American public has come to accept such occurrences. These statistics and the side effects associated with conventional treatments have never raised pervasive concern. In contrast, adverse events associated with CAM treatments get widespread alarmist attention. Indeed, the Commission stated that in order to cover CAM, information would first be needed on how such treatments affect worker productivity, morale, recruitment, retention, and stress. It is doubtful that conventional treatments were subject to such evaluations or that such preconditions were placed on their coverage. It remains to be seen how these differing standards would affect approval of insurance coverage of CAM.
According to the Commission, the research regarding safety and effectiveness is needed to form the criteria used by insurance companies and managed care organizations in deciding what is “medically necessary” when it comes to treatment and claims. Insurers and HMO’s rely greatly on medical necessity criteria to define the extent of a benefit, manage the use of it, and make claims payment decisions. As stated by the Commission, these criteria are also used to control use of and spending on health care services, determine cost estimates on which premiums are based, and “maintain the financial soundness of the insurance and managed care industries.” The actual process of determining what is medically necessary is based on studies and criteria developed by academic medical institutions, professional organizations, private companies, and even the insurers and managed care companies themselves. But as stated by the Commission, currently, “few criteria are available to guide practitioners in deciding the medical or, more generally, the clinical necessity of CAM interventions.” Until this gap in research regarding safety and efficacy, and therefore clinical necessity, is filled in, this practical barrier to coverage remains in place.
Additional barriers relate specifically to Medicare coverage of CAM. Under Medicare’s 55 benefit categories, services and products must be “reasonable and necessary” in order to be covered. The criteria for determining what is “reasonable and necessary” are very specific. Once again, without the research on CAM’s safety and efficiacy, it is difficult to work such treatments into the “reasonable and necessary” criteria. The Commission delineates further barriers to CAM’s inclusion in Medicare coverage, including anti-kickback rules, which restrict referrals between conventional and CAM practitioners making it difficult to provide for medicare coverage in integrated practice settings.
At Envita, we believe that regardless of insurance coverage, the issue of data and research to support the efficacy and safety of advanced natural medicine is critically important. We are attempting to create, through our treatment protocols, a standard for the industry. We are using treatments that are already based in the published peer-reviewed scientific literature so that the clinical evidence of their effectiveness can be expanded. In addition, we have created quality of life studies so that there are tangible data to also support the benefits of advanced natural medicine on the overall well-being of patients. As more practitioners and treatment facilities do the same, the body of support for CAM will begin to grow, which inevitably will be a step towards removing some of the practical barriers discussed above.
In this article, we have just begun to scratch the surface when it comes to the barriers involved in coverage of natural medicine and CAM. In Part II of this series, we will continue our examination of the remaining practical barriers to coverage, including the lack of adequate information on the use, costs, and overall cost-effectiveness of CAM, as well as the operational hurdle presented by uniform billing codes.
