Medicare: the Good, the Bad and the Ugly

The Good

• Medicare has done away with A2000, and adopted the new chiropractic CTP codes that resulted in a significant fee increase for doctors of chiropractic.


• President Clinton has recommended in his budget the elimination of the x-ray mandate. We now have our work cut out for us to stimulate so much grass roots support that legislators will support the elimination of the mandate.

The Bad

Medicare still does not pay doctors of chiropractic for examination or x-ray fees. It appears that legal action will be required to challenge existing Medicare regulations for there to be any reasonable hope of changing such an unfair and discriminatory policy. At the ACA board of governors meeting in January, the board in a bold and courageous move voted to take just such legal action if the policy is not changed after exhausting all administrative remedies. Until all administrative remedies have been exhausted legal action would be thrown out of court. It is estimated that it will take one to one and one half years for that to happen. It is possible this unfair policy could be resolved without legal action, but not likely. Even with legal action there is no guarantee of victory, but it is high time we take any and all steps to end this discrimination.

The famous line in the movie Network a few years ago, "I am mad as hell and I'm not going to take it anymore," is a motto this profession and our patients needs to take to heart. Enough is enough!

The Ugly

How did such an unfair and discriminatory policy come to be? In 1967, Congress asked HEW (Department of Health, Education, and Welfare) to conduct an unbiased study to determine the need for including coverage for chiropractic services under the Medicare act. That "study" was a sham orchestrated covertly by the America Medical Association and resulted in fraud against the United States Congress. Thirty years later, we are still living with the legislation that was enacted as a result of the AMA's action.

Much has recently been reported in the chiropractic media about the Medicare CPT codes, President Clinton's budget proposal to eliminate the x-ray mandate and the legal action ACA will take if administrative remedies fail. It is not my intent to cover the details of all of that.

The purpose of this article is to let the readers know the facts about just how ugly, immoral, illegal and unethical the AMA's action were. How their actions were effective in causing millions of Americas to suffer needlessly by not receiving chiropractic care, being exposed to unnecessary radiation, and having to pay money out of their pockets that should have rightfully been covered by Medicare. Even though what the AMA did was over 30 years ago, its impact continues today. The AMA should apologize for what they did to the American people and the chiropractic profession. They should use all of their legislative clout to rectify the wrong they did, but I'm not holding my breath until they do.

Because of space limitations, this article will be in two parts. Its primary focus will be to cover some of the factual details that expose how the AMA accomplished the sham. The source of my information comes from primarily two court documents: 1) exhibits filed in 1976 when we first filed the antitrust lawsuit against the AMA; and 2) plaintiffs' "Summary of Proofs as an Aid to the Court" filed June 25, 1987.

While many of you are aware of some of the facts in this case, we have a generation of new DCs and students that know little or nothing about the AMA's plan to destroy the chiropractic profession. Few are aware of the specific details of how the AMA actually implemented their Medicare sham. Thus a brief review is necessary so all readers have a foundation from which to relate the facts that follow.

The Goal

In the early 1960s, the AMA became concerned about increased professional cooperation between MDs and DCs, and the growing number of people seeking chiropractic health care. They devised a plan which was formally implemented in 1964 with the establishing of the Committee on Quackery. Their goal was to first "contain" chiropractic, and then "eliminate" it.

The Plan

Their plan was detailed and elaborate. In a confidential document dated September 21, 1967 they outline the "Committee's short-range objectives," listing four specific goals. Number one on their list was "Doing everything within our power to see that chiropractic coverage under Title 18 of the Medicare Law is not obtained."

In this same document they reported that if section 141 of HR 12080 was enacted (this section provides for a "study to determine the feasibility of inclusion of certain additional services under Part B of Title 18 of the Social Security Act"), "the staff and Committee already have commenced investigating the possibility of Stanford Research Institute of Menlo Park, California, being given the assignment by HEW to conduct such a study ..." They went on to report: "We have been reliably informed the outcome of such a study would not recommend chiropractic services be included under the act, and might very well go so far as to call it a health hazard." This is the same AMA that has berated the chiropractic profession mercilessly for not having "scientific research." Here they have the outcome of a research study determined before it was ever conducted! That research project was never done, but it shows the extremes the AMA was willing to go to obtain their goal.

The following is either quoted or paraphrased from the Plaintiff's Summary of Proofs:

In 1967, Congress asked HEW to conduct an unbiased study to determine the need for including coverage for chiropractic services under the Medicare Act. The actual study that was conducted was a "sham" engineered by the AMA and medical physician members of the Public Health Service of HEW. In fact, the outcome was decided five months before the study commenced. "Biased" study panel members were recommended by the AMA and appointed by the Pubic Health Service. The AMA secretly "coached" the panel members and suggested how they should vote. Doctors of chiropractic charged that the panel and the study had been fixed. Congress then demanded an explanation. The response deliberately misled Congress about the AMA's secret involvement in the study and lack of bias of the panel members.

Dr. Sam Sherman was an AMA member and a member of the Health Insurance Benefits Advisory Council (HIBAC) of HEW (Sherman Dep. 10, 12-13, 89, 93). The proposed study was to commence in August, 1968. The work of the study panel was supposed to be "Administrative Confidential." (PX-702A)

On February 20, 1968, defendant Doyl Taylor informed Dr. Sherman: "I'm sure you agree that the AMA hand must not show in this matter at this stage of the proposed chiropractic study." (PX-220) On March 11, 1968, five months before the study commended, Dr. Sherman answered defendant Doyl Taylor:

"Dear Doyl,

... There was complete acceptance [by HIBAC] of the concept of preparing the decision on the basis of lack of scientific merit." (PX-1414; emphasis added.)

Dr. Donald Duncan, an anatomist and former faculty mate of the executive vice-president of the AMA, was appointed chairman of the study panel. (PX-232, 1579) The AMA had panel member (and AMA member) Dr. Feffer determine which panelists were "soft" on chiropractic. (PX-1579) The AMA could then secretly contact the panel members for "coaching":

"Dear Doyl,

I have instituted a rather roundabout procedure to contact Dr. Milbourne with the message. I am working through my partner who is working through some of his New York friends who will attempt to decide who would be the best orthopedic surgeon in New York to coach Dr. Milbourne." (PX-482;August 29, 1968, letter of AMA Committee on Quackery member Stevens to defendant Taylor of AMA; emphasis added.)

Panel member Dr. Mennell complained of the AMA's coaching:

"I was disturbed in the past four weeks to receive two telephone calls indirectly from, but quite clearly inspired by, the American Medical Association implicitly suggesting what the tenor of my paper should be. I can only assure the consultant group that my conclusions are arrived at through my independent research, thinking and experience unaffected by extraneous pressure." "Certainly doctors of chiropractic should not be penalized simply because of the bitter bias of the American Medical Association when there is substantial evidence that manipulative therapy brings relief to sufferers from mechanical pain which only manipulative therapy can relieve." (PX-1529 at 1,6)

On October 2, 1968, six weeks before the doctors of chiropractic were even due to testify before the panel, Dr. John Southard of HEW told Dr. Stevens of the AMA Committee on Quackery:

"(T)estimony by the AMA of the medical profession is unnecessary as the final answer has already been determined." (PX-332)

A few weeks later, but still several weeks before the chiropractic organizations were scheduled to testify before the HEW panel, Committee on Quackery member Stevens wrote that no further help from the "AMA or the medical profession was needed as the final answer has already been determined." (PX-332)

The AMA continued to secretly contact Dr. Duncan (PX-232) and, in addition, received confidential documents of the panel for copying from Dr. Feffer, a panel member, who admitted that he was biased against chiropractic before the study even commenced. (Feffer Dep. 67; emphasis added.)

"As indicated in our conversation, it would be helpful if we can be kept informed as to the progress of your committee work. Any reports or proceedings received will be quickly reproduced or transcribed and returned to you. Your help is very much appreciated. bcc: H. Doyl Taylor" (PX-337; AMA letter to Feffer of August 27, 1968; emphasis added.)

The study panel considered the AMA's ethics proscription on interprofessional relations:

"The American Medical Association has stated that it is unethical for a physician to refer a patient to these practitioners and likewise could be expected to voice strong opposition to such a proposal. Even if such a proposal became law, its implementation would require mass and open defection on the part of medical doctors from the policy of its own association. Although it has been stated that physicians secretly refer patients to doctors of chiropractic and naturopathic doctors now, it would be quite another thing for them to sign a document stating they had referred a patient to a chiropractor or naturopath, which would be necessary under this method of reimbursement." (PX-702A, p. 12; emphasis added.)

The final vote of the panel was four to four. This was changed, after an informal procedure, to five to three against inclusion of chiropractic in Medicare. (Mennell testimony.)

In a "white paper," the chiropractic organizations (ACA and ICA) charged that the resulting report to Congress was "fixed." (PX-344) The white paper also explained that the chiropractic organizations disclaimed any belief in the "one-cause/one-cure" theory of disease. (Id.) Congress demanded a response from HEW.

The members of the Public Health Service that had privately worked with the AMA prepared a response that concealed the AMA's active but covert involvement:

"The Ad Hoc Group itself recognized and discussed two possible sources of bias. The first was from attempts by organized groups or individuals with special interests to influence the study. The Group decided that it would not hear or consider material from any group other than those being studied, and that no outside observers would be allowed lest they influence or inhibit the discussions. Thus, when the American Medical Association contacted the former Secretary of HEW and asked to meet with the Ad Hoc Consultant Group, the Group unanimously agreed that such a meeting would be inappropriate." (PX-239, p.5)

This response was deliberately concocted to mislead. It made no mention of the extensive "coaching" and private sessions of panel members and HEW medical physicians with the AMA or its agents. The actual reasons why the panel had refused a public meeting with the AMA were never disclosed to Congress -- but they had been privately communicated to the AMA in a telephone call:

"Doctor Cashman (an HEW medical physician) advised me (AMA attorney Harrison) that the consultant group discussed the proposed meeting and determined that such a meeting may create legislative problems for their recommendations which are to be submitted to the Secretary for his report to the Congress." (PX-1246: emphasis added.)

Though it asked for a response to the charges of AMA involvement, Congress was never told: (a) that the results of the study had been concluded five months before the study even commenced; (b) that the AMA had secretly "coached" the members of the panel; (c) that the AMA had suggested how the panel members should vote; (d) that the AMA had provided the panel members with AMA materials; (e) that the AMA had procured and copied confidential documents from the panel during the study; (f) that biased members had been selected for the panel; (g) that a 4-to-4 vote (changed 5 to 3) under these circumstances had supported the negative report; (h) that the Principles of Medical Ethics of the AMA had been considered as a barrier to inclusion of chiropractic under Medicare; and (i) that an HEW medical physician had been in private contact with AMA during the study.

As a result of the negative report of the panel, Congress delayed including chiropractic care in Medicare for five more years. Moreover, the negative report became the base AMA public relations document used in opposing chiropractic. The AMA needed the apparent "third-party" attack on chiropractic to avoid the "fairness doctrine" under which the national news services gave "equal time" to doctors of chiropractic to respond to anti-chiropractic statements coming directly from the AMA. (PX-1384)

The HEW "study" was a sham and (the sham issue regardless) proof of the anti-competitive intent of the defendants' other activities in pursuit of their massive anti-chiropractic boycott and conspiracy.

Tying it All Together

Now you know some of the specific details about how the AMA keep chiropractic out of Medicare for five years. It was not until the ACA and ICA joined together to write and present to Congress the "white paper" that Congress took a second look at including chiropractic in Medicare. When chiropractic was finally included on a very limited basis -- manipulation only demonstrated by subluxation on x-ray -- the AMA's hand was still pulling strings. They did not believe that subluxations existed or that they could be seen on x-ray. Thus chiropractic care would be technically covered, but in reality the barriers placed in the way of people would keep most from ever seeing a doctor of chiropractic and being reimbursed under Medicare.

It's important to keep in mind that while all of this was taking place, the above evidence was not known by anyone but the AMA. It was not until we filed the Wilk vs. AMA antitrust lawsuit in 1976 that the pieces of the AMA's illegal puzzle were put together by George McAndrews. By then many years had past since Congress included chiropractic in Medicare.

Changing legislation is very difficult, and frustrating. Gradually over the years, since the Wilk case exposed the AMA's illegal action, and more and more legislators learned they had been misled by the AMA, we have been gaining support in Congress to amend the Medicare law. A year or two ago we had enough support to finally get the law changed until the Congressional Budget Office (CBO) came out with a ridiculously high cost estimation that such a change would have on the budget. The past few years, Congress has been "trying" to reduce spending and has been unwilling to pass chiropractic legislation that will increase the budget in the amount the CBO estimates.

The ACA has adopted a three prong attack:

1. continue trying to get the law changed legislatively;
2. continue trying to get the problem corrected by administrative change; and
3. take what ever legal action is necessary.

This has not and will not be an easy battle. Your help is needed! When called upon to get grass roots support from your patients, please do it. When called on to give to the legal fund, please do it.

Michael D. Pedigo, DC
San Leandro, California
E-mail: MikePedigo@aol.com