The Best of Times, the Worst of Times (Pt. 2)

Editor's Note: This three-part article series is co-authored by Drs. Dave Elton, John Allenburg, Wayne Bennett, Marty Caron, Darren Chase, Molly Magnani, Ben McDowell, Melissa Naegre, Garret Rock, Robb Russell, and Mike Simone - all doctors of chiropractic. Access their LinkedIn pages for more information at the end of this article. Part 1 of this three-part article appeared in the November issue.

---

Howard Wolinsky’s 2020 book, Contain and Eliminate: The American Medical Association’s Conspiracy to Destroy Chiropractic, chronicles the systemic barriers chiropractors faced from the 1960s through the 1980s. While the tactics may have changed, the current experiences of DCs make it seem like the goal of “contain and eliminate” may still exist.

In part 1 of this series, we examined two important, yet largely invisible forces influencing the practice environment for DCs. In part 2, we turn our focus to the daily administrative and financial challenges DCs must navigate.

Network Contracting

Most specialties contract with insurance companies through a group tax identification number (TIN), which provides numerous benefits for all stakeholders. Intermediary DC networks commonly contract with DCs as individuals through their national provider identifier (NPI). Interestingly, these same intermediaries may contract with physical therapists through a group TIN.

The primary reason for individual NPI contracting with DCs is to all but eliminate the ability to negotiate contract terms. The adverse impact is amplified through “take it or leave it,” “all or none” contract bundles. To accept a reasonable contract, a DC is required to accept one or more unfavorable contracts, no questions asked. Unlike other specialties, DC contracts rarely include periodic cost-of-living adjustments.

Fee Schedules

DCs’ concerns about unsustainable reimbursement have historically been combined with and dismissed along with similar concerns from other specialties. That changed with the 2022 Transparency in Coverage rule, which requires insurers to publish machine-readable files (MRFs) of fee schedule data. MRFs demonstrate how disadvantaged DCs are.

• While most specialties have commercial insurance reimbursement at 130% or more of the Centers for Medicare and Medicaid Services (CMS) Medicare fee schedule, DC commercial reimbursement is typically well below CMS and often below Medicaid.
• For the same service, DC reimbursement is significantly lower than all other specialties, even in states in which a “payment parity” statute exists.
• For a given service, a high level of variability in reimbursement exists among individual NPIs for all specialties except DCs, for whom there is little to no variability.

Copays / Deductibles

Low and unchanging reimbursement, combined with rising patient copays and deductibles, means patients often pay the entire cost of a DC visit. Beyond the financial burden on patients, this raises concerns under 42 U.S. Code § 300gg–5 Section 2706(a), which prohibits discrimination in provider reimbursement.

If a plan reimburses $0 for a visit with a DC, but reimburses more than $0 for the same services when provided by a different specialty, is the service truly covered when delivered by a DC?

Prior Authorization (PA) / Utilization Management (UM)

Despite strong guideline support, an excellent safety profile, capped visit limits, low reimbursement, and high copays, chiropractic care is often subject to prior authorization (PA) requirements. As described in part 1, insurers may apply PA to DC services to satisfy mental health parity compliance. If PA is required, the process must be designed to avoid adding unnecessary administrative burden and delays in patient care.

DCs face a PA process that is anything but efficient. Administrative costs associated with PA and appeals often exceed the cost of the services being reviewed. When cases are identified as requiring clinical review, that review is often performed by a DC who has never seen the patient, possibly in another state, and typically spends less than two to three minutes reviewing limited information for a patient a DC may have spent at least 60 minutes evaluating in person.

Profiling, Tiering and Peer-to-Peer Coaching

Most intermediary DC networks use provider profiling to assign DCs to tiers that influence reimbursement levels and PA requirements. DCs deemed “outliers” are required to participate in “peer-to-peer coaching” to address perceived performance deficiencies. In extreme cases “outliers” may have their contracts terminated.

Intermediary profiling methodologies often have significant limitations:

• Arbitrary thresholds applied based on small sample sizes and simple averages, without estimates of measure uncertainty through use of confidence intervals
• Lack of adjustment for variation in clinical characteristics or patient benefit designs
• Use of incomplete claims data with a focus on service utilization rather than industry-standard quality or patient outcome measures

Industry Standard Transactions

The Health Insurance Portability and Accountability Act (HIPAA) requires health insurers to support electronic data interchange (EDI) standards. EDI standards reduce paperwork, speed up payments, and lower administrative costs by streamlining administrative tasks like verifying patient eligibility, submitting claims and receiving remittance information.

Many intermediary DC networks avoid the investment required to support key components of EDI. The effect is to force already underreimbursed DC practices to absorb unnecessary administrative costs to verify coverage, print and review remittance statements, and manually post payments.

Another reason some intermediaries do not support EDI is to embed their administrative fee into the flow of claims, which would become transparent in standard EDI files.

Student Training Barriers

Unlike students in other specialties, DC students under the direct supervision of a licensed DC are frequently prohibited from participating in patient care for commercially insured patients due to contractual limitations imposed by intermediary DC networks. This type of restriction significantly limits DC students’ clinical experience, placing them at a disadvantage compared to their peers in other health professions who enter practice with substantial hands-on, reimbursable clinical experience.

Like the administrative cost shift associated with the absence of EDI, DC academic programs must absorb added administrative and financial burdens to ensure students receive adequate practical experience.

Patients Seeking Chiropractic Care Are Functionally Uninsured

DCs and patients discover coverage is often illusory, with patients essentially functionally uninsured. As a hypothetical example: A patient’s certificate of coverage (COC) describes coverage for up to 20 visits with a DC and a $40 copay. The DC is contracted with an intermediary network that caps reimbursement at $41 per visit, requires prior authorization (PA), tiers providers based on average visits per episode, and does not support standard electronic data interchange (EDI) files.

Through prior authorization and tiering processes, the intermediary authorizes, or strongly guides practices to provide, only five visits. For each ~$200 billed, the DC is reimbursed $41, of which the patient pays $40, leaving a net $1 payment from the insurance company.

For that $1, the provider incurs more than $20 in administrative costs to manually verify eligibility and benefits, submit prior authorization forms and post payments. Eventually DCs and patients decide it makes more sense for the patient, theoretically with insurance coverage, to just pay cash.

Take-Home Points

DCs provide convenient access to patient-centered, evidence-based, whole-person healthcare. Intermediary DC networks convert this into a commodity sold to insurers: a network large enough to meet access requirements at the lowest possible cost, achieved through utilization controls and suppressed reimbursement.

The result? Chiropractic care has become a profit center – not for DCs, but for the intermediaries who siphon revenue and influence away from the chiropractic profession. When DC practices are pushed to the edge of economic viability, it’s the patients who suffer. Those with spinal pain, work injuries and chronic conditions are left with fewer, more invasive and often less-effective options.

DCs and their patients deserve better. Our healthcare system needs better. In Part 3, we will explore what better could look like.

List of Co-Authors:

• Dave Elton (corresponding) dave@arete.healthcare LinkedIn Arete Healthcare
• John Allenburg LinkedIn ChiroCenter Chiropractic & Wellness
• Wayne Bennett LinkedIn Bennett Clinic
• Marty Caron Caron Chiropractic
• Darren Chase LinkedIn The Athlete Stop
• Molly Magnani LinkedIn IPGMN – Integrated Provider Group of Minnesota
• Ben McDowell LinkedIn McDowell Chiropractic
• Melissa Nagare LinkedIn Southern California University of Health Sciences
• Garret Rock LinkedIn Arete Healthcare
• Robb Russell LinkedIn Southern California University of Health Sciences
• Mike Simone LinkedIn Simone Physical Medicine