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MORE WORKERS USING ALTERNATIVE ROUTE

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SAN FRANCISCO -- Baby boomers are turning to alternative medicine in growing numbers, giving employers an opportunity to provide them with a valuable and inexpensive health benefit.

Employers can retain and attract workers by offering at least partial coverage for services employees have paid for themselves for years, said Alan Kittner, president and chief executive officer of Consensus Health, a San Francisco-based company that markets alternative care programs to employers.

Mr. Kittner said during a presentation at the Self-Insurance Institute of America's conference in San Francisco last month that approximately one-third of Americans use some sort of alternative or "complementary" health care.

But it's more accurate to say that about 10% to 18% of workers use services that require payment, he added, because many workers practice techniques such as yoga or massage that do not require a health care provider.

Mr. Kittner pointed out that, under a New England Journal of Medicine definition of alternative health practices, chiropractic services are the most frequently offered. Other practices include acupuncture, massage, relaxation techniques, herbal medicine, homeopathy and wellness services.

The term "complementary" is increasingly used to refer to alternative health care because "there's a growing belief that these services aren't outside the mainstream," Mr. Kittner said. "Or, if they are, they really shouldn't be, that they're really part and parcel" of what many refer to as "holistic or integrated care."

He pointed out that "it's really been the baby boomers bringing these services more to light. And as they age, which leads to an increase in chronic conditions, these are the services that have the greatest opportunity to have an impact on people's lives." These alternative techniques take over where conventional medicine has "fallen short" in providing the kind of care many aging boomers prefer, Mr. Kittner added.

Users of alternative medicine generally have higher incomes and education than those that rely solely on conventional medicine, he said. About 60% to 65% are women, and, increasingly, workers in technology and computer industries are turning to alternative medicine, Mr. Kittner noted.

He surmised that they are "not only people who are more educated but very independent, seeking control over their own lives. They tend to be interested in products that allow them choice. They don't need establishment support to feel good about themselves," and they "tend to be more open-minded."

Employers have an opportunity to attract and retain employees by offering alternative health care benefits, and health plans can expand their markets, Mr. Kittner pointed out.

"This is a predominantly consumer, out-of-pocket market," he said, with around 85% to 90% of services not reimbursed. Payment of chiropractic services makes up the bulk of reimbursements that are made.

Health plans have begun to respond to consumer demand for alternative medical services, Mr. Kittner noted. "The real economic motivation is for them to gain market share and to increase member retention."

Like health plans, employers want employees who are happy about their health care choices, he added.

Employers traditionally have provided some alternative services, mostly chiropractic, as part of supplemental riders, Mr. Kittner noted.

Under the riders, employers pay additional monthly premiums of about $1.50 to $4 for each employee for coverage that offers access to specialists such as chiropractors or acupuncturists. "It allows the consumer to pay only a fraction of the cost and have the rest reimbursed," Mr. Kittner said.

He mentioned some additional ways to offer alternative health services to employees. "A different approach that is fairly new is the access program," he said. "It's essentially a preferred provider network that offers discounts on a broad range of services. . .And the consumers still pay out of their own pockets for these services."

Under such an arrangement, the employee receives significant discounts because the employer pays a monthly fee per worker for the coverage. The employer's cost usually is only about 15 cents to 30 cents per worker, significantly lower than the payments for a supplemental rider that provides reimbursement.

Mr. Kittner said he expects integrated programs to become more popular over the next 10 years. The programs allow physicians to work with complementary care practitioners to offer a full range of services.

Under such a program, a primary care physician refers patients when necessary to a provider such as a chiropractor or acupunturist who works at the same office. "It's integrated there in terms of protocols, treatment guidelines, medical supervision and choice."

Mr. Kittner pointed out that while such programs are not yet widely in place, they will grow in popularity. "I predict there will be a day that, when you open up a health plan directory, you will be able to see with an asterisk" which physicians provide integrated care, he said. "You can go and see them and get referred to a complementary care provider within their office or they themselves are complementary care physicians. . .trained in chiropractic or acupuncture or herbal medicine."

Integrated programs, Mr. Kittner said, are the "model of the future."

Joe P. Bogar, director of marketing and sales at VHA Tri-state Health Plans Inc. in Indianapolis, moderated the session.