As nontraditional therapies like acupuncture and massage continue to move into the medical mainstream-including many once-reluctant managed-care plans-proponents are trying to win over the diminishing pockets of resistance to the concept of alternative care.
"Be open to various possibilities; retain a certain element of scientific curiosity," says William Stewart, M.D., who heads an alternative-care clinic at San Francisco's California Pacific Medical Center, which seeks to combine the best of both worlds. After all, he notes, the first person who suggested doing open-heart surgery was not immediately greeted with open arms by the medical establishment.
But Stewart needn't fear. For a host of reasons, the "bamboo curtain" between traditional and non-Western medicine is coming down, as managed-care companies, providers and entrepreneurs begin to chase a thriving, multibillion-dollar market.
Breaking down barriers. Advocates of alternative healthcare-also known as complementary and alternative medicine-are breaking down barriers that have long isolated such treatments from allopathic or traditional Western medicine. Health insurers in increasing numbers are paying for or improving access to once-obscure treatments such as biofeedback, Chinese herbal medicine, massage therapy and meditation. With funding from the National Institutes of Health, major universities such as Stanford, Stanford, Calif., the University of Texas, Austin, and Columbia, in New York, are subjecting alternative therapies to the rigors of Western science. Employers are seeking out HMOs that offer access to alternative-care networks.
"There's a lot of momentum on the part of health plans and on the part of vendors," says Elizabeth Brown, M.D., national medical director for the Chicago-based Blue Cross and Blue Shield Association.
In an era of shrinking profits, many HMOs face fierce competition, skyrocketing pharmaceutical costs and a sagging public image. They see alternative care as a way to win new enrollees and differentiate themselves from the competition while controlling costs.
That's especially true when it comes to treating chronic conditions such as back pain that often don't respond well to traditional medical care.
Even providers such as West Coast innovators Kaiser Permanente and California Pacific, as well as hospitals in other parts of the country, are exploring formerly exotic forms of treatment.
Officials at Deaconess Hospital in Evansville, Ind., for example, are considering a proposal to build an integrative health and medicine clinic at the facility, says Mary Beth Davis, a holistic specialist at the hospital.
"Our consumer demand is very high, as high as it is. . . in California," she says.
No one is sure yet how much progress nontraditional therapies will make, or how fast-in part because many haven't faced rigorous testing. Also, many alternative providers have little interest in or experience with the mainstream healthcare universe. A few high-profile disasters could puncture a number of trial balloons.
"Everyone's afraid they're going to tank the company," James Dillard, M.D., said at a recent American Association of Health Plans conference session on the subject. Dillard is medical director of the highly touted alternative medicine unit at Norwalk, Conn.-based Oxford Health Plans.
Much remains to be done in credentialing and providing managed-care oversight for alternative-care providers, many of them long tarred by doctors and hospitals as charlatans.
But it's increasingly clear to managed-care companies that consumers are clamoring for holistic therapies.
Lucrative market. Some estimates put the current size of the market at $24 billion or more, with a growth rate close to 15% per year. It's no wonder that struggling managed-care plans across the country are beginning to seriously consider alternative-care options.
More than four in 10 adults surveyed late last year by Landmark Healthcare, a managed alternative-care company based in Sacramento, Calif., say they had used some form of alternative care within the past 12 months. Two-thirds called the availability of such care an important factor in choosing a health plan.
Educated middle- and upper-middle-class Americans are most likely to use such therapies, primarily for chronic pain, anxiety, muscle sprains and strains, and addictions, according to a study by Stanford University researcher John Astin published in the May 20 Journal of the American Medical Association.
HMOs that don't offer alternative-care coverage within the next five years "aren't going to be able to compete," predicts Oxford's Dillard.
Before Oxford's financial woes began to hit home late last year, the plan was one of the national trailblazers in expanding the alternative-care market. Although its problems appear to have derailed plans to augment coverage of alternative-care treatments in the short term, Dillard insists that Oxford "plans to continue in this vein and to enrich the program in the next couple of years."
Oxford, far from the West Coast where alternative medicine is most common, offers a network of 2,800 alternative-care providers, including about 1,400 chiropractors, 650 massage therapists and 350 acupuncturists. Nearly half of Oxford's 2 million enrollees use some form of alternative care. The company has negotiated special, discounted rates for its enrollees with contracting yoga instructors, massage therapists and nutrition specialists.
Yet uncertainties surrounding clinical efficacy, cost and broad acceptance of alternative therapies have caused most health plans to proceed cautiously with expansion.
Officials at San Francisco-based Blue Shield of California admit they weren't ready last year to offer alternative therapies as a covered benefit, but they wanted to piggyback onto the popularity of those options.
"Consumers were already utilizing those services. They were voting with their feet and with their dollars," says Bob Wadsworth, a Blue Shield commercial products manager. So beginning Jan. 1, Blue Shield began giving enrollees access to a network of alternative-care providers, including chiropractors, acupuncturists, massage therapists and fitness centers, at a 25% discount off the providers' standard rates.
Blue Shield was surprised by the amount of feedback it received. But like virtually all the managed-care companies MODERN HEALTHCARE contacted, officials were leery about providing details on how many enrollees actually use alternative-care services. In these early days of mingling mainstream and alternative medicine, most consider this data to be highly proprietary.
Although the public's response has led Blue Shield to consider offering covered alternative-care benefits, Wadsworth says it's still more likely that Blue Shield will offer elective "riders" to its managed-care policies that allow employers to choose whether they offer alternative-care options to their employees.
"Do you bring in alternative services and hike up rates across the board, or do you offer a rider?" Wadsworth asks. "In the next two to three years, I think you'll see more of the latter."
Even so, employer groups with Blue Shield PPO plans already can include acupuncture and chiropractic care in their package of benefits, at an additional cost, if they so choose. Capitated medical groups have the discretion of sending HMO patients to alternative-care providers.
Like most health plans and mainstream provider groups, Blue Shield is working with outside vendors that actually create a contracted network, validate the credentials and training of alternative providers, and handle standard managed-care chores such as utilization review.
"Policyholders are demanding such coverage, and a lot of insurance companies have decided to cash in on this," says Kenneth Pelletier, a Stanford University researcher.
A few years ago, just two or three insurers covered alternative care; now 29 do, Pelletier says. Early converts included big names like Kaiser Permanente, Group Health Cooperative of Puget Sound, Health Net, Prudential, Blue Cross of California and various other Blues plans around the country.
Major PPO plans such as Beech Street Corp. also are investigating the alternative-care universe.
This November, Denver-based Blue Cross and Blue Shield of Colorado will take the plunge. The Colorado Blues will begin marketing an alternative-care package to its Blue Advantage Medicare risk enrollees, which offers what executives call a "blend" of covered benefits and other options available through a discounted affinity program.
Working with Landmark Healthcare and WellCall, a San Francisco-based information and referral service for wellness and alternative-care providers, the 470,000-enrollee Colorado Blues plan will start with its 12,000-enrollee Medicare HMO and possibly expand from there.
Gaining momentum. Many employers and managed-care plans are scrambling to catch up with consumer demand.
"Employer groups often ask us about benefits for alternative medicine," says Kathy Baffone, a product development specialist for Woodland Hills, Calif.-based Health Net, one of California's largest HMOs. About one-third of Health Net's employer groups, covering some 700,000 enrollees, have signed up for some sort of alternative healthcare benefit.
Health Net, which has covered chiropractic care since 1990, recently asked the California Department of Corporations-the agency that regulates HMOs in the state-for approval to offer acupuncture, acupressure and Chinese herbal medicine.
"If we can demonstrate that it's cost-effective, (employers) are open to it," says Nadya O'Connell, a senior consultant at Aon Consulting in San Francisco.
And all signs point to increased momentum in the near future, despite skepticism from some traditional providers and what virtually all observers say is a deficit of serious scientific study in the area.
John Weeks, an alternative-care guru in Seattle who publishes the Alternative Medicine Integration and Coverage newsletter, says virtually every major managed-care organization in the country has a formal or informal working group charged with developing alternative-care products.
"We're aggressively investigating this topic," says Robert McDonald, M.D., corporate medical director for Cincinnati-based Anthem Blue Cross and Blue Shield.
Anthem already offers discounts to enrollees on a variety of exotic herbal and nutritional supplements, including St. John's Wort, garlic, ginkgo biloba, echinacea and ginseng.
Just five years ago, only 15 of 125 medical schools in the U.S. offered courses on alternative medicine. Now that number is more than 60, Weeks says. Examples besides Stanford University include Columbia University; Harvard, in Cambridge, Mass.; Johns Hopkins University, Baltimore; the University of California at Los Angeles; and Yale, New Haven, Conn.
And this month, University of California San Francisco Medical Center is launching the Osher Center for Integrative Medicine, which is designed to explore combining alternative and traditional Western approaches. Initially, the center will study alternative approaches to treating heart disease and therapies for breast cancer including herbal medicine, yoga, dance and meditation.
San Francisco's California Pacific Medical Center in February launched the Health and Healing Clinic, which seeks to integrate conventional medicine with "appropriate" alternatives, including acupuncture, massage, yoga, nutritional and herbal therapies, meditation and prayer. Negotiations are under way with a number of health plans regarding coverage of the center's treatments.
"The goal is to create an integrated insurance package" covering a combination of conventional and alternative therapies, says Stewart, the center's medical director and chairman of California Pacific's ophthalmology department.
Another indication of burgeoning mainstream support is the growth of the NIH's Office of Alternative Medicine in Bethesda, Md., which was established six years ago. Annual funding has jumped from $2 million initially to $20 million this year. A lobbying effort is under way to increase that funding level tenfold for fiscal 1999.
Simultaneously, a swelling number of alternative-care providers are in the educational pipeline, a development that one researcher compares with the spike in medical-school graduates in the 1970s.
The number of graduates from chiropractic programs is expected to more than triple, to 5,200 in 2001, from the level six years ago, according to research by Richard Cooper, M.D., of the Medical College of Wisconsin, Milwaukee, that's scheduled to appear in JAMA this month.
Demand is being fueled by consumers and the increasing numbers of states that license alternative providers, Cooper says. All 50 states now license chiropractors, and 11 of them mandate that health plans include chiropractors in their provider networks. Acupuncturists are licensed in 34 states, with Illinois and Virginia recently joining the list, Cooper says. Naturopaths-who typically use a combination of "natural" therapies such as herbal remedies, nutritional counseling and vitamins-are licensed in 11 states.
Conventional doctors, meanwhile, are becoming more tolerant of their erstwhile competitors in some of these areas. According to a recent NIH report, half of all physicians are now willing to refer patients to alternative practitioners, or already do so.
Ready for rapid growth. Taken together, experts read these signals as an indication that the market is primed to take off.
"This year we've already grown by 600,000 enrollees, and I expect to add 800,000 to 1 million more by Jan. 1," says Marla Orth, Landmark Healthcare's chief executive officer, whose privately held company has contracts with several Kaiser and Blues plans. Landmark has some 3 million alternative-care enrollees overall, most of them in the Western U.S., the mid-Atlantic states and New England, and that figure could reach the 4 million mark by early next year.
Alan Kittner, CEO at San Francisco's Consensus Health, a Landmark competitor that last year helped set up Blue Shield of California's alternative healthcare network, is exploring similar deals with "large health plans throughout the country."
Consensus worked with San Diego-based American Specialty Health Plans, which handled credentialing and utilization review for the chiropractic portion of the discounted Blue Shield network.
"We've been besieged by requests to replicate the Blue Shield program," Kittner said following a nine-day, early August trip to the Northeast, Midwest and South to negotiate with potential clients.
A jump-start. The first big break in alternative care's isolation from the mainstream came in 1993.
That's when a Harvard University study published in the New England Journal of Medicine revealed that consumers in 1990 spent nearly $14 billion on alternative healthcare-more than the $12.8 billion spent that year on out-of-pocket inpatient care. And as few health plans covered alternative treatment at the time, about $10.3 billion-or three-quarters-of the total came out of consumers' pockets.
That pioneering study, by David Eisenberg, M.D., jolted many in the healthcare industry into reconsidering their views on alternative care.
Another boost came last November, when an NIH panel concluded that there is solid evidence that acupuncture is a useful treatment for four conditions: postoperative and chemotherapy-induced nausea and vomiting, pregnancy-related nausea, and postoperative dental pain.
The panel also identified acupuncture as an acceptable option for a number of other pain-related conditions, including addiction, stroke rehabilitation, headache, menstrual cramps, general muscle pain, lower-back problems and carpal tunnel syndrome.
Putting it to the test. Alternative-care advocates say the biggest obstacle to further insurance coverage is the lack of scientific certainty that surrounds alternative care. Many therapies haven't been tested in rigorous, double-blind fashion by research scientists.
Acupuncture and a few other forms of treatment have received some scientific scrutiny-and validation-but many alternative therapies are still unproven. That makes it hard for insurers to cover them, and even harder for doctors to prescribe them or make referrals.
At Kaiser "we are just beginning to unify our efforts," says Harvey Goldberg, D.O., Kaiser's regional coordinator for complementary and alternative medicine for the health plan's California division.
Kaiser launched an office of alternative medicine at the beginning of the year to examine the scientific evidence for various forms of therapy, and meetings are under way to coordinate its efforts nationally, Goldberg says.
Perhaps surprisingly, doctors at Kaiser are reacting with what Goldberg describes "cautious interest."
Kaiser specialists already have the freedom to refer patients to pain clinics in Northern California for acupuncture treatment. But in medical-education surveys of Kaiser doctors, alternative care "is rising to the top of the things they're interested in," Goldberg says. "They want to see the data in order to know how to proceed."
At Woodland Hills, Calif.-based Blue Cross of California, medical directors are caught in a dilemma created by strong consumer demand for untested therapies, says spokeswoman Elise Anderson.
California Blue Cross has offered some coverage of acupuncture, acupressure and chiropractic for several years but has taken an intentionally low-key approach.
"The market is asking for some of these things, but there aren't the same kind of end results we can use for comparison," she says.
Alternative-care proponents and some academic researchers say the solution is simple: Do the research, treating alternative care the same as any other proposed treatment for disease or chronic illness.
Bringing alternative care inside the academic realm is helping to shift scientific thinking significantly, says alternative-care guru Weeks.
"In this case, familiarity has not been breeding contempt, but interest and use," he says. "Downstream are utilization and coverage."