After AT&T began offering acupuncture to its management employees as an option in one of its health insurance plans in January, the company said “less than a handful” of workers sought treatment.
Kaiser Permanente, the nation’s largest HMO, had more success, saying it had strong demand at its clinics in California that offered acupuncture and other alternative medical services.
Alternative medicine, long on the fringes of medical care, is slowly being offered by more health plans. While most states require health insurers to cover chiropractic care, some states have gone further, requiring many insurers to cover treatments like acupuncture.
But there are limitations. Companies like AT&T that have self-financed health plans are often exempt from the rules, as are health-maintenance organizations in states like California that do not classify them as insurers.
In most cases, patients who want their insurance to pay for alternative care are not free to seek treatment themselves but must first be referred to an alternative provider by their primary-care physician. And Kaiser’s alternative medicine program, for example, is in only a few clinics and only in Northern California.
Last month, Oxford Health Plans, a managed-care company based in Norwalk, Conn., took alternative medicine beyond state mandates, announcing that it would become the first large medical insurer to have a network of alternative-care providers. Starting in January, it will offer the treatments in Connecticut, New Jersey and New York. Later next year, Pennsylvania will join the list. And no physician referral will be required.
Citing a company survey conducted in March showing that 33 percent of its 1.5 million members in five states had used some form of alternative medicine in the last two years, Oxford officials said they were simply meeting consumer demand.
But they are also tapping into a $50 billion market, and industry analysts, as well as medical and insurance professionals, say they expect Oxford’s move to push other insurers to keep up.
“Managed-care organizations are competing bitterly with each other and are looking for every kind of marketing tool they can find to get people to sign up with them,” said George D. Lundberg, editor of the Journal of the American Medical Association. “Since alternative medicine is popular with many patients, a managed-care company wanting an edge might be very smart to offer it.”
Although the medical community has increasingly incorporated some forms of alternative medicine in traditional treatments, doctors caution that many forms of alternative care are still being tested and question whether Oxford’s action is too much too soon.
“I think it does raise the bar, and I think that’s good,” said Dr. Peter Lee of Kaiser Permanente, who helped develop the alternative-medicine program. But, he added, “We want to assure we’re giving quality care to our members and patients.
“We don’t want to go off and offer something that won’t do any good, waste money or perhaps harm them,” he said.
Lundberg added, “Herein lies a major hazard to patients who could be taken advantage of by such a system — being offered unproven therapy for some disease for which there is proven therapy.”
Oxford is aware that some forms of alternative medicine have not gained widespread acceptance, but company officials say their network will complement traditional medicine, not replace it.
“We are going to aggressively encourage or require that members also see their primary care physician,” said Dr. Hassan Rifaat, the manager of alternative medicine for Oxford.
Oxford said its network would be made up of 500 to 1,000 acupuncturists, chiropractors, massage therapists, naturopaths, yoga instructors, clinical nutritionists and registered dietitians.
Acupuncturists, chiropractors and naturopaths, who treat patients with a combination of diet, exercise and “natural” remedies like herbs, will have to meet several requirements to join the network, including graduation from a fully accredited school that teaches the procedures, a license, two years’ continuous clinical experience, continuing education credits and proper malpractice insurance.
“It’s a way of assuring customers,” said David Snow, an executive vice president of Oxford.
Oxford is offering the network to individuals and employers as an addition to their current coverage. For employers, adding the network would add 2 percent to 3 percent to their overall premium, or about $5 to $6 a member annually. Members would then be able to visit a chiropractor, acupuncturist and, in Connecticut only, a naturopath, on a co-pay basis. New Jersey and New York do not license naturopaths.
The move by Oxford was not a bolt from the blue. At least 45 states require health insurers to cover chiropractic services, seven states require acupuncture coverage and two states require coverage for naturopaths. Connecticut, New Jersey and New York require only chiropractic coverage.
The broadest requirements are in a Washington State law that was passed last year and that took effect in January. The law mandates that insurers provide coverage for an array of alternative medical procedures.
Marla Rothouse, a policy specialist with the Health Policy Tracking Service of the National Conference of State Legislators, predicted that other states would follow Washington’s lead.
“I think you’re going to see a lot more of that,” she said. “It’s freedom of choice.”
