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Healthcare Policy regarding Acupuncture and Chinese Medicine in the United States

Healthcare System

by Snohomish Brown LAc, CMT

July 13, 2017


The role of acupuncture and Chinese medicine in today's health care system continues

to evolve as people discover its effective usefulness in treating a variety of conditions.

Unfortunately current healthcare policies and legislation make it difficult to extend these

benefits to the more vulnerable populations and it still remains out of reach for many

consumers. The advantages and disadvantages presented by current healthcare policy are

relatively dependent upon one's point of view as the various stakeholders experience health

outcomes largely determined by socio-economic status. In the long term however, it remains

in each of our best interests to recognize that we are all in this together as the burden of

caring for the uninsured eventually falls upon the rest of us too (Garthwaite, 2015).

In our assessment of the Affordable Care Act (ACA), for example, the advantages of

greater access to care and expansion of services appear to outweigh the disadvantages of

additional government spending. However, it seems as though those advantages may be

short lived with the threat of Republican efforts to repeal and replace the ACA looming.

Notable other advantages that may soon go away as a result of repeal include coverage for

chronic pre-existing conditions, Essential Health Benefits (EHBs), and the expansion of

Medicare and Medicaid for the poor, as well as federal tax credit premium subsidies to assist

those who qualify to pay for health insurance (California Health Benefits Review Program,

2011). For many newly insured, these subsidies in the form of tax credits, are the only way to

make health insurance affordable to them. If these were no longer available and if the federal

government also stopped subsidizing insurance companies to lower their premiums, then

surely many more Americans would not be able to afford insurance either, nor be able to pay

for healthcare when they need it (Dranove, 2017).

“CBO and Joint Committee on Taxation estimate that enacting the Better Care

Reconciliation Act of 2017 would reduce federal deficits by $321 billion over the coming

decade and increase the number of people who are uninsured by 22 million in 2026 relative to
current law.“ (Congressional Budget Office, 2017). Many states will likely repeal EHB

mandates within their state, although some may choose to keep those provisions in place.

California will probably continue to maintain a strict mandate of coverage for most of its

population as it strives to move toward a single-payer system (California Healthcare

Foundation, 2014). Benefits of the federal budget deficit are short sighted, however, as less

insured vulnerable populations will incur greater costs at the state level in the long term,

costing tax payers as much, if not more, later on (Garthwaite, 2017).

Craig Garthwaite is a researcher with the Commonwealth Fund whose drive to

understand the true cost of public insurance programs led him to question the rationale

behind repeal and replace. “We want a debate about the Affordable Care Act and the

Medicaid expansion and public insurance in general to be based on economic facts,”

Garthwaite says. “There are people who say it costs too much. What do we mean when we

say it costs too much?” (Garthwaite, 2015). If policymakers truly want to balance state

budgets, regardless of whether they want to offer statewide public health insurance plans or

not, they must factor in the costs of uncompensated care. “There will always be a minimum

level of care that people are going to consume,” Garthwaite says. “So we need to have a

conversation about how to most efficiently provide that care—otherwise we’re left with sloppy

arguments. Choosing to ignore this population doesn’t mean the cost of that care is ever

going to go away.” (Garthwaite, 2015). The application of acupuncture and Chinese medicine

to solve some of the health concerns of this growing uninsured population may help, but there

is not enough understanding around the current research to demonstrate acupuncture's

effectiveness definitively and then there is the cost for which these services need to be

adequately compensated.

Grassroots efforts and alliance coalitions have garnered unprecedented support for

legislation to create a single-payer healthcare policy in California. This would mean that all
healthcare would be paid for by the government and everyone would receive coverage based

upon need, but the plan to pay for it has not been worked out yet (Mason, 2017). Also, no

one really knows what this might mean for reimbursements as there has been a conservative

effort to reduce costs for many Medicaid services despite simultaneous efforts to expand

services for needy populations since the mid 1970s (McGreevy, 2017). Many imagine that

single-payer would look like Medicaid for all, and knowing what reimbursement rates look like

for Medicaid, we can imagine that incomes might be too low for many TCM practitioners to

remain open without making significant changes to their business model. Medi-Cal

(California's Medicaid program) reinstated acupuncture benefits last year in June for its

beneficiaries, but it only pays a little more than five dollars for a fifteen minute unit of face to

face treatment (Department of Health Care Services Medi-Cal, 2016). This does not seem

like a feasible pay rate to put together any kind of business model in the greater Los Angeles

Metropolitan area. Perhaps this is less of a problem in rural areas, or with a community clinic.

But certainly even in those cases, it would be difficult to run a profitable practice. Thankfully,

perhaps for acupuncturists at least, the Assembly Bill has been shelved until next year in the

California Legislature while these issues get worked out (Dayen, 2017). But the need for

action still a priority in the face of new federal legislation, that seeks to strip health care

benefits for many people.

The Acupuncture for Heroes and Seniors Act of 2017 is still only a bill on Capital Hill,

introduced for the second time by Judy Chu, Representative from California; but it promises to

provide access to qualified acupuncturist services for military members and their dependents

under the TRICARE program (H.R. 2839, 2017). Veterans enrolled in the Department of

Veterans Affairs (VA) health care system will be able to seek treatment from trained

acupuncturists, civilian employees in the Department of Defense of the grade of GS-12 or

higher under the General Schedule. It's difficult to say what sort of reimbursement level that
might be, but estimates for Los Angeles annual salary range between $81,000 and $105,000

(Federal Pay, 2017). Other provisions of this bill direct the Secretary of the VA to carry out

such programs in at least one VA facility in each Veterans Integrated Service Network in both

urban and rural areas. Also, the Secretary is directed to establish the Advisory Committee on

Acupuncturist Services. Title XVIII of the Social Security Act is amended to provide Medicare

coverage for acupuncturist services and the Public Health Act is amended to make

acupuncturists eligible for appointment in the commissioned Regular Corps and the Ready

Reserve Corps of the Public Health Service (H.R. 2839, 2017).

The Judy Chu Bill is a similar bill as last time, presumably with the same strengths and

weaknesses as before. It features again: parity with other physicians, advisory committee

with only four acupuncturists, acupuncturists are defined as having appropriate certification or

licensure in their respective state. This distinction presumably excludes physical therapists

who perform dry needling, and perhaps other physicians who lack appropriate licensure or

certification. Essentially however, they would complete with other providers, but consumers

would not need a referral to access services (H.R. 2839, 2017). Social security budget

constraints as well as veteran's affairs resources are both woefully underfunded as it is. So,

here again the main weakness of this bill is determining how to pay for it.

The policies currently in place to protect the scope of practice of acupuncture from

encroachment by other professions vary state to state. At least six states, including New York

and California, have made dry needling illegal, yet many more states have affirmed its

practice is within the scope of Physical Therapists (PTs), largely due to the political influence

of the American Physical Therapist Association (APTA). Injury lawsuits are on the rise in

some states where dry needling is still allowed, yet only account for 1% of complaints say

malpractice insurers for PTs (Haughney, 2017). The paucity of experience most physical

therapists have after their weekend training compared to the three to four years of
experience most certified acupuncturists enjoy often results in poor outcomes, bruise injuries,

and even in some cases punctured lungs or other organs when consumers go to see a

physical therapist for dry needling (Haughney, 2017). Moreover the evidence does not seem

to support the theory behind trigger point needling as aggressive needling techniques do not

prove to be as effective as traditional acupuncture meridian points protocols and needle

retention time. Therefore “the position statements by the APTA and many State Boards of

Physical Therapy do not seem to be consistent with the existing literature. “ (Dunning et al,

2014). Many of the reasons that this is still an issue in many states relates to the problem our

industry faces in other lobbying efforts as well. We don't have enough numbers nor enough

consensus on the issues facing acupuncturists and lobbying is expensive. Having a stronger

national presence would certainly effect access to acupuncture services however, and

hopefully we are still moving in that direction.

Recently the accrediting agency that grants deemed status to hospitals who receive

Medicaid funding issued a stern warning to Physicians urging them to reconsider non-

pharmacological approaches to pain management in light of the current opioid epidemic. “This

Joint Commission document puts a tremendous tool in the hands of anyone seeking to

promote integrative pain treatment.” (Weeks, 2015). For acupuncturists looking for

recognition of value added services, this may provide a useful avenue to provide care to the

under serviced. The recommendation lacks punitive measures of enforcement however, and

as the general consensus among physicians remains that the Joint Commission acts

somewhat as an impediment to their jobs; it might be an empty gesture nevertheless.

On the other hand, policy changes in the way that disease classifications are handled

are set to include Traditional Chinese Diagnostic terminology as part of the ICD-11 revision.

Currently those who are working on this project are seeking input from those in the field of

Chinese medicine to make comment and evidence based suggestions. "This work is
something, which is relatively unprecedented in the area of traditional medicine, particularly at

this level," said Dr. Molly Meri Robinson Nicol, technical officer at WHO (Rosen, 2016). "The

ICTM, including the selection included in ICD-11, will be the foundation on which future

research will be based. This classification will serve as a tool for the collection of clean, clear

data on who is using traditional medicine, what they are using it for, if it works, if it is safe, how

much it costs, and how it compares to other medicines in similar situations." (Rosen, 2016).

Since 1999, the United States made ICD coding mandatory for mortality data. Over the past

17 years, hospitals have been adopting and maintaining ICD implementation updates. The

most recent update was the ICD-10 in October of 2015, which required its use for all inpatient

hospital procedures (Duran, 2011). Nicol noted that the ICTM also will support clinical

research and documentation, policy development, and healthcare reimbursement, in such a

way that it will be consistent and capable of comparison globally. “Acquiring a set of

diagnostic codes along with the incorporation of a Doctorate degree as a professional entry-

level requirement in the U.S., will pave the ground for TCM practitioners. We are heading

down the same road that fairly recently, Doctors of Chiropractic traveled” (Rosen, 2016). Let's

hope she is right about that.

The plan to educate other healthcare administrators and legislators could be outlined

briefly as: write letters, make phone calls, and send petitions. It is more effective to sway the

minds of politicians with sufficient numbers however, and so it will be necessary to form

coalitions with others of like mind. The next step or action plan in California would therefore

be to choose a strong Acupuncture lobbying power and become a member. Then it might be

prudent to take on any of their specific recommendations and wait and see. Alliances are

important in spite of the fact that support for the single payer bill in California appears to be

dividing once again into separate factions (Dayen, 2017). By contrast, the success of the

APTA lies in their sheer numbers and the significant lobbying power those individuals are able
to purchase (Haughney, 2017). Let this be a valuable lesson to acupuncturists and perhaps

an urgent call to action as well.

If California legislators seek to remedy the changes which are likely to take place on

the Federal level by passing a single payer for all bill, that will dramatically change things

(Dayen, 2017). The concern is that the result will be a system that looks like Medi-Cal for all,

where the payouts to acupuncturists are less than what one can afford to keep a practice

running. Certainly this factor will cause some practitioners to move out of state or possibly

influence an increase in reimbursement rates if this becomes a problem for too many

providers, but only time will tell. For the consumer, this could be a mixed blessing also. With

the government in charge of managing payment for all healthcare services, there are

concerns of inefficiency, bureaucracy and corruption.

There is a feeling that the private sector is much more capable at managing healthcare

than the public sector (Dayen, 2017). There is ample evidence that the reverse is true

however, as government programs are subsidiary to private sector aims to make a profit and

the private sector believes it can only lose money by caring for vulnerable populations. On

the contrary, “an analysis of uncompensated care data from Medicare Hospital Cost Reports

from 2011 to 2015 found that uncompensated care burdens fell sharply those states where

Medicare was expanded” (Dranove et al, 2017). Between 2013 and 2015, operating costs for

uncompensated care fell from 3.9 percent to 2.3 percent. This is a big deal when profit

margins for these non-profit hospitals are often around two percent. “Estimated savings

across all hospitals in Medicaid expansion states totaled $6.2 billion.” (Dranove et al, 2017).

The largest reductions in uncompensated care were found in hospitals located in expansion

states that care for the highest proportion of low-income and uninsured patients. Federal or

state legislation that scales back or eliminates Medicaid expansion is likely to expose these

safety-net hospitals to large cost increases. “Conversely, if the nineteen states that chose not
to expand Medicaid were to adopt expansion, their uncompensated care costs also would

decrease by an estimated $6.2 billion.” (Dranove et al, 2017).

California currently has a mandate that all plans sold to consumers must at least offer

acupuncture benefits as an additional rider if they are not included as part of coverage

(Goodacre Insurance Services, 2015). This mandate only affects small group plans

(California Health Benefits Review Program, 2011). There are several other plans, most of

them more expensive than the benchmark plan, that offer better acupuncture coverage, but

medical necessity is often interpreted differently by each insurance company according to

updates in clinical research, as it is published and made available in the literature.

Consequently, each plan may cover acupuncture differently or have limits or caps on

coverage (Goodacre Insurance Services, 2015). Insurance plans are meant to be competitive

and it stands to reason that if there is enough demand for acupuncture, then subscribers will

pay for it. Kaiser HMO was used as benchmark plan for California's comparison of benefits

among other similarly rated plans (The Henry J. Kaiser Family Foundation, 2017). It listed

acupuncture as a covered benefit, but only to treat nausea related to pain disorders.

Allied Specialty Health (ASH) contracts with many acupuncturists, perhaps more than

most of the other networks (California Health & Wellness, 2017). It is difficult to estimate, but

I am aware of many insurance companies and plans that are contracting with ASH since they

have gathered such a large network of acupuncturists. When I was offered to join, I found the

contract offered low reimbursement rates of roughly $40 per visit in many cases. I turned it

down, feeling that this was not enough to pay for my time or expenses related to running a

business and that this would burden me with too much paperwork and result in burnout.

Plans like Kaiser and ASH that offer acupuncture to their subscribers, intend to keep

subscribers utilizing services within their network of contracted providers, so that they can

keep their reimbursement costs to providers as low as possible. Some more expensive plans
cover the cost of acupuncture services even out of network however, and this is where I am

often approached to work with patients who have insurance benefits they can use. Blue

Cross and Blue Shield offers their subscribers to pay 50% of out of network costs, but I

imagine that with most contracted in-network providers reimbursement rates for this company

may be about roughly equivalent either way. (Blue Shield of California, 2015). The only

difference is that the ACA allows for out of network balancing to shift the responsibility of the

other half of treatment to the patient. Those providers in-network would only be allowed to

charge what they had agreed to in their network agreement. In Los Angeles there are

sufficient consumers with ample income to afford out of pocket fees for services and the

majority of my patients pay in full at the time of service. I have a few patients who will request

a Super-bill to make a claim for reimbursement with their insurance company, but I do not

network with any and do not see any reason to either. Unless we move to a single payer

system, and it is such a big mystery what that will look like if that happens, I guess I should be

prepared for anything.

References

Acupuncture for Heroes and Seniors Act of 2017, H.R. 2839, 115 th Congress, (2017).

Blue Shield of California (2015). Platinum 90 PPO Provider Network Name: Exclusive
Summary of Benefits and Coverage: What this Plan Covers & What it Costs.
Retrieved from: https://www.blueshieldca.com/bsca/sbc-
assets/public/ifp/Platinum_90_PPO_SBC_1-15.pdf

California Health Benefits review Program (2016, January). Resource: Health Insurance
Benefit Mandates in California State and Federal Law. Oakland, CA: Author. Retrieved
from:http://chbrp.org/other_publications/docs/FINAL_CA_Mandates_Update_2016_01
2916.pdf

California Health Benefits Review Program (2011, January). ISSUE BRIEF: California’s
State
Benefit Mandates and the Affordable Care Act’s “Essential Health Benefits”.
Oakland, CA: Author. Retrieved from: http://chbrp.org/documents/ACA-EHB-Issue-
Brief-011211.pdf
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ACA: California vs. Federal Provisions. Retrieved from:
http://www.chcf.org/~/media/MEDIA LIBRARY Files/PDF/PDF A/PDF
ACAbenefitRules.pdf

California Health & Wellness (2017, February). American Specialty Health Plans for
Acupuncture Services. Retrieved from:
https://www.cahealthwellness.com/newsroom/ASH-Plans-Acupuncture.html

The Henry J. Kaiser Family Foundation (2017). Essential Health Benefit (EHB) Benchmark
Plans, 2017. Retrieved from: http://www.kff.org/health-reform/state-indicator/essential-
health-benefit-ehb-benchmark-plans-2017/

Congressional Budget Office (2017, June). H.R. 1628, Better Care Reconciliation Act of 2017
Cost Estimate. Washington D.C.: Author. Retrieved from:
https://www.cbo.gov/publication/52849

Dayen, D. (2017, July 12). THE COALITION PUSHING FOR SINGLE PAYER IN
CALIFORNIA IS FRACTURING. The Intercept. Retrieved from:
https://theintercept.com

Department of Health Care Services Medi-Cal (2016, August). Acupuncture Services are
Restored. Medi-Cal Update Acupuncture Bulletin 491. Retrieved from:
https://files.medi-cal.ca.gov/pubsdoco/bulletins/artfull/acu201608.asp

Dranove, D., Garthwaite, C., & Ody, C. (2017, May). The Impact of the ACA's Medicaid
Expansion on Hospitals' Uncompensated Care Burden and the Potential Effects of
Repeal. The Commonwealth Fund, Vol. 12 (Issue Brief). Retrieved from:
http://www.commonwealthfund.org

Duran, B. (2011). First-Ever Information Standards For Traditional Medicine Go Online.


Acupuncture Today, 12 (9). Retrieved from: http://www.acupuncturetoday.com

Dunning, J., Butts, R., Mourad, F., Young, I., Flannagan, S., & Perreault, T. (2014). Dry
needling: a literature review with implications for clinical practice guidelines. Physical
Therapy Reviews, 19 (4), 252–265. Retrieved from:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4117383/

Federal Pay (2017). General Schedule (GS) Payscale in California for 2017. Retrieved from:
https://www.federalpay.org/gs/2017/california

Garthwaite, C., Gross, T., & Notowidigdo, M. (2015, June 22). Who Bears the Cost of the
Uninsured? Nonprofit Hospitals. Kellogg Insight. Retrieved from:
https://insight.kellogg.northwestern.edu

Garthwaite, C., Gross, T., & Notowidigdo, M. (2017, Jan 5). Under the ACA, the Cost of
Caring for the Uninsured Decreased for Hospitals. Kellogg Insight. Retrieved from:
https://insight.kellogg.northwestern.edu

Goodacre Insurance Services (2015). Acupuncture health care and California health plans.
Retrieved from:
https://www.calhealth.net/california_health_insurance_acupuncture.htm

Haughney, C. (2017, May 23). ON PINS AND NEEDLES Is dry needling a safe acupuncture
replacement, or a shortcut around years of essential training? Quartz. Retrieved from:
https://qz.com/958309

Mason, M. (2017, June 23). California won't be passing a single-payer healthcare system any
time soon – the plan is dead for this year. The Los Angeles Times. Retrieved from:
http://www.latimes.com

McGreevy, P. (2017, June 1). Single-payer healthcare plan advances in California Senate –
without a way to pay its $400-billion tab. The Los Angeles Times. Retrieved from:
http://www.latimes.com

Rosen S. (2016). Changing the Cultural View of Medicine, Part 2. Acupuncture Today, 17 (4).
Retrieved from: http://www.acupuncturetoday.com/mpacms/at/article.php?id=33171

Weeks, J. (2015). The Joint Commission Moves Integrative Approach Ahead of


Pharmaceuticals for Pain Management … plus more. Integrative Medicine, 14 (2), 12-
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