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Triangle Business Journal
Raleigh / Durham

Some Health Plans Accepting Alternative Care
Cartherine L. Traugot
August 16, 1999

CHAPEL HILL -- Richard Dunn's alternative health care provider network, Alternative Healthcare Options, was born out of a frustrating experience his wife had with her medical doctor.

After being prescribed an anti-depressant when lab tests showed nothing abnormal, Linda Dunn went to a naturopath who helped her get to the root of the problem. "But it wasn't paid for by our insurance,'' Dunn said. 

As an insurance broker, Dunn knew his wife's situation was not unique. "Being a broker, I heard more and more clients say, `Why isn't this service covered under my plan? I didn't have to take as much pain medication or didn't need surgery because of this treatment,''' says Dunn. So Dunn decided to do something about it. Last year, he formed Alternative Healthcare Options (AHO), based in Charlotte, to help people pay for alternative health care.

Networks of alternative care providers are nothing new to West Coast residents who've been quick to embrace everything from herbal therapies to Eastern medicine specialties like acupuncture. Now they're gaining acceptance here, as companies see the marketing value in adding them. Earlier this year, WellPath Community Health Plans of Chapel Hill signed an agreement with AHO to use its network of acupuncturists, naturopaths and massage therapists. For now, WellPath members receive a discount from network providers, rather than getting a covered benefit (where a user either makes a "co-payment" or pays a small percentage of the bill). Dunn hopes that employers and HMOs will eventually choose to make alternative care a covered benefit.

A 1998 study published in the Journal of the American Medical Association found 42 percent of adults used at least one form of alternative medicine or therapy in 1997, spending more than $33 million. WellPath chose to add the AHO network after employers told them they wanted some type of alternative coverage for their employees. The program was initiated July 1. "When we first started looking at offering this in 1997, there was no network in North Carolina,'' says Sandy Scherer, a spokesperson for WellPath which has 60,000 customers. When they discovered AHO they began working with them. "They already had the local tie with providers.'' 

WellPath says it will evaluate the interest from employers in providing this as a covered benefit, possibly as a rider, "like companies chose vision benefits,'' Scherer says. Blue Cross and Blue Shield of North Carolina launched an alternative medicine discount plan Aug. 1, in time to add to the marketing pitch for year 2000 enrollment. "We've covered some alternative options in select situations,'' said Fred Hartman, a spokesman for Blue Cross which has one million customers eligible for the benefit. "This gives customers the broadest choices.'' Would Blue Cross add these alternative therapies as benefits in the future? "This is the step we're taking now, I couldn't look down the road,'' Hartman says.

Instead of offering alternative care as a covered benefit, both WellPath and Blue Cross negotiate discounts with alternative care providers in the network. WellPath members get 20 percent off for alternative providers and a 10 percent discount for wellness services like fitness club memberships. Alt Med Blue members receive a 25 percent and 15 percent discount respectively. Neither plan requires a referral from a primary care doctor although members are encouraged to discuss their treatments with their physicians. Right now, neither discount plan is available to HMO members who are government employees because those long-term contracts need to be negotiated to include it.

Both plans also have very few costs for the HMO to pass on to employers. The providers agree to the discounts in exchange for the added business being on a PPO list provides. They are not reimbursed. Alt Med Blue providers are also not reimbursed– although there is no fee to get in the network. The plans do spend money making sure providers meet standards for their specialty. AHO certifies its own network using the National Committee for Quality Assurance guidelines. Alt Med Blue uses a California-based company,

Consensus Health, to screen participants using those same guidelines. The certification process screens out practitioners with lay knowledge, but no formal accreditation. Naturopaths, for instance, have no national accreditation program, so AHO is only certifying practitioners with a four-year postgraduate degree from one of only three U.S. programs that offer it (all in western states.) Self-trained naturopaths can't meet the PPO guidelines.

Unfortunately, that's the one specialty that Patricia Quay, AHO's quality assurance officer, would like to have more of. "That's a weakness for us. Naturopaths don't want to deal with managed care. Chiropractors, on the other hand, are used to it.'' Quay is also keeping an eye out for qualified mind-body medicine practitioners in areas like yoga, hypnotherapy and guided imagery.

Although alternative medicine proponents argue that these treatments can sometimes save money by getting patients off of expensive prescriptions or help them avoid surgery, the HMOs say this isn't the reason they are offering the discount cards.

"That's not the goal or purpose,'' says Scherer. "It's a choice they've asked for.''  

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