Alternative medicine will be the focus of a PPO being developed in Chicago, MODERN HEALTHCARE has learned.
The PPO is being launched by a spinoff company of The Ethix Corp., a Portland, Ore.-based managed-care company that is being bought by New York Life. Hospitals and other health-Alternative medicine
care providers are being sought to participate in the effort, which will be operational by Jan. 1, 1995.
"This PPO really legitimizes the (holistic healthcare) business," said Scott Christie, program director for the new venture being test-marketed in Chicago. "Chicago is the epitome of a Midwest market, and if we can do it here, we can make it anywhere. Our desire is it to take this national."
Steve Gregg, the current chairman of Ethix, will be involved in developing the venture known under Ethix as Integrated Health Services. The venture will take on a new name early this month because of the buyout. Executives wouldn't release costs of the venture.
Hospitals and alternative-medicine practitioners in Chicago already are showing interest in the PPO. Contracts with providers should be completed by late fall, executives said.
Initially, the effort seeks to organize providers and get consumers as much information as possible about holistic approaches to care.
"By organizing these people and setting up policies, we can set up a `clinic without walls,'*" Mr. Christie said.
"The focus of this will be a PPO product, but individual consumers will be able to call for information regardless of whether they have insurance," he said.
Alternative therapies generally are defined as medical treatments not taught widely at U.S. medical schools or available at U.S. hospitals.
But supporters of holistic care say they're reducing healthcare costs by keeping people out of inpatient settings.
The field has attracted interest among establishment medical authorities. The National Institutes of Health in Washington and Columbia University in New York have established centers to research alternative medicine.
The amount of money spent out-of-pocket for unconventional medicine is much greater than many people think. In 1990, $14 billion was spent by consumers on holistic therapies, $10 billion of which was spent out-of-pocket, according to a recent study published in the New England Journal of Medicine.
"Those statistics attest to the will of people searching for additional therapies," Mr. Christie said.
The PPO is expected to capitalize on a provider relationship formed two months ago when Chicago's 479-bed Grant Hospital, owned by for-profit giant Columbia/HCA Healthcare Corp., announced an affiliation with the Chicago Holistic Center, which has about 50 alternative-medicine practitioners and some 1,500 patients (July 25, p. 10). Grant's program begins this fall with educational classes on holistic medicine.
"Because of the size of Chicago and the number of holistic practitioners here, contractual relationships with providers have the greatest opportunity for success," Mr. Christie said. "(Grant) is one of the first hospitals to get into holistic care. If I can funnel people into their classes it will be beneficial to them."
At IHS headquarters in Portland, an information system is being developed for utilization review for the PPO. Consumers will call a toll-free telephone number answered by clinical professionals. Healthcare providers would be available to speak with callers, IHS executives said.
"The big focus here is information," Mr. Christie said.
Nationally, there were 425 million visits to unconventional providers last year, compared with 388 million visits to primary-care physicians, according to the Chicago Holistic Center and the .
"There's more and more evidence of people using holistic care," Mr. Christie said. "Some of our employer groups are inquiring about holistic care."