Report from a Regional CAM Network: Complementary Healthcare Plans, Portland, Oregon
Written by John Weeks
Report from a Regional CAM Network: Complementary Healthcare Plans, Portland, Oregon
Summary: Complementary Healthcare Plans is Portland, Oregon's home-grown managed complementary care network. Begun as a chiropractic managed care company, the firm added acupuncture, massage therapy and naturopathic medicine services in the late 1990s, then a discount or "affinity" product which includes an array of benefits to employees or members of the corporations and insurers with which CHP contracts. It's largest client is Kaiser Permanente Northwest. The Integrator spoke with Chuck Simpson, DC, a CHP founder and its vice president and medical director about the state of the managed-CAM market in Portland, Oregon.
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CHP's vice president and co-founder Chuck Simpson, DC
The mid-to-late 1990s witnessed a consumer-focused movement by some employers, insurers and managed care companies toward covering the services of licensed complementary and alternative healthcare practitioners. The typical strategy was essentially non-integrated. Benefits were "carved out" and managed by specialty managed care firms.
In managing complementary care, the main players were chiropractic managed care companies which had formed around the prior expansion of chiropractic inclusion which went back to the early days of managed care.
One such regional provider was a chiropractic network formed in 1989, ChiroNet. In the late 1990s, the firm added networks of naturopathic physicians, massage therapists and acupuncturists and emerged as Complementary Healthcare Plans (CHP). Since then CHP has developed vision and dental benefits, an employee assistance program, a natural products offering through CNCA, and a lifestyle/wellness offering through the Life Balance program.
CHP's main client is Kaiser Permanente Northwest. The firm also provides administrative services for Regence Blue Cross/Blue Shield of Oregon and some managed workers compensation through Providence Health Plans and Kaiser On-the-Job. In addition, CHP has an array of clients for its discount affinity product. The Integrator spoke with Chuck Simpson, DC, a CHP founder who until recently maintained a full-time chiropractic clinical practice and has served on Oregon's Board of Chiropractic Examiners. He currently serves as CHP's vice president and medical director.
Integrator:I know for a period of time CHP was looking at expanding nationally. Where are you located now? How many people are you serving?
Simpson: Our primary service area is Oregon and southwest Washington. We're currently expanding into the rest of Washington. We've got about 250,000 lives in covered CAM benefits and almost 500,000 with access to the affinity products. We are also working on some ideas that would take us into Idaho, Utah, Montana and Arizona.
Integrator: So what is the environment like for managed complementary care?
Simpson: The general trend we see is away from the risk model (when specific CAM care is contracted to a vendor such as CHP for a price per member per month). Payers are increasingly taking CAM benefits "in-house" where we're seeing a much "skinnier benefit" when it is offered, an integrated deductible with higher co-payments and lower caps. So the $500 CAM benefit is behind a $500 deductible.
Integrator: That sounds almost like sleight of hand, to me. What's an example?
Simpson: A benefit in the past might have been at say $1500 total benefit with no deductible and a $10 co-payment per visit by the plan member. Now we're more likely to see a model with a $500 cap with up to a $25 per visit co-payment. The benefit price has pretty well gone away. Integrator: Is this about disillusion with complementary care benefits?
Simpson: I don't think so. The benefit is still very popular. Everyone else in the allied health fields is in the same mode - dental, vision, behavioral health. The pressure on costs for purchasers is coming from major medical and the hospitals. The PMPM (per member per month) for total management of care may be, say, $600. If there is CAM in the benefit, it is
"(The cost of CAM) is not much, but a purchaser looking to save money may cut out the CAM and other allied health benefits."
likely only $1-$3 bucks PMPM. One the high side, it may get up to $7-$8 per hour. It's not much, but a purchaser looking to save money may cut out the CAM and other allied health benefits. Integrator: CHP has a so-called "affinity product" doesn't it, through which members get access to networks of providers, or to products, for a discount off the provider's usual fees?
Simpson: We saw the need in the circumstance of declining interest in covered CAM benefits to have some way of promoting CAM. We particularly wanted to have something to promote directly to employers. It's set up as a discount of 20%-30% off the practitioner's usual and customary charges, so the customer knows what they are paying going in. It's gradually taking off. Very interesting to observe. Integrator: What does it cost an employer? Simpson: With the whole suite of offerings, all the provider types, the wellness the employee assistance program and the supplement discounts and other programs in our CAM Plus plan, it can be up to $2 (per member per month). To an employer it's pretty neat. For just $24 per employee per year, they can give this card to their employees, and say, here, you can have a discount on all of these services. Employers know they can't get anything in healthcare for $24 per year.
Integrator: Back when these discount or affinity products got started, there was talk from some players that they were the "Trojan Horse" for getting CAM services into a health plan. The idea was that medical directors were too conservative and disbelieving of CAM values to expand covered CAM benefits - so this was a way to do something with very little risk which could also tell the customer that they cared about the consumer's interest in CAM. Then, as the argument went, a relationship could be built, maybe some analysis of experience, and some would begin to "purchase up" into covered benefits. Do you see this pattern?
Key CHP client
Simpson: First, it's very hard to track the use of the affinity services. We've tried but we don't get much information back. It's hard to get providers to tell you what they are doing if you aren't paying them. I don't know anyone who does.
We have seen some conversion to covered benefits. There's an employer group that started with the affinity product, started the next year with a chiropractic benefit and plans to add other providers Integrator: Have you managed to develop any analysis of whether the covered benefits are cost-neutral, save or cost plans more money? Simpson: Unfortunately, there isn't a lot of incentive for the insurer to look into that. If CAM saves money, the insurer benefits of course, but the savings aren't passed on to the purchaser. If costs of care go up, then the insurer passes the cost along and cost of insurance premiums go up.
On whether there is evidence of cost offsets from CAM
"Unfortunately, there isn't a lot of incentive for the insurer to look into that."
Integrator: I have come to view it - yes, unfortunately - as a cost plus environment. If the price of health care goes up, they just get a percentage of a bigger number. It's actually a reverse incentive. Is there hope that complementary practitioners will ever be pro-actively included on the basis of cost savings and the value to consumers?
Simpson: We think self-funded employer groups who really pay the bills are the best to approach with the value proposition of CAM as a cost offset. They're paying $600 and more per employee per month. Some of these employees are spending $1500-$2000 per year on pharmacy costs. I think if we could get them to send them to our providers we could make a real difference in their health care costs. Integrator: A final question. You are working full-time with CHP now, I understand. So how is the transition from being a chiropractic practitioner with a clinical practice who was working part-time at CHP to being a full-time managed care goon?
Simpson: This is my third year out of practice. Being in practice is such a high, with the daily contact with patients and helping them get better. I miss that. There is nothing like that in what I do here. The feedback now is often challenging or negative. I miss the patient contact but I find a lot of satisfaction in helping take care of patients by the tens of thousands in our plans instead of the hundred that care through my own office.
Integrator: Thanks for the data sharing, and your directness. Disclosure: CHP has supported and participated in an employer-managed care working group which I helped co-create some years ago and made a direct contribution of $2500 to the Integrator's first year.
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