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AMA’s Government-Protected Monopoly Squeezes Out Alternative Medicine

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stethoscope and dollarThe world of medicine is run by billing codes. Every hospital, doctor, and practitioner who accepts insurance or Medicare uses billing codes so they can be reimbursed. But where are the codes for integrative and alternative medical services?  Our Action Alert to the DHS this week asks for the incorporation of these integrative codes.

Healthcare codes describe medical, surgical, and diagnostic services, remedies, and supply items provided to patients. They are designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, payers (insurance, managed care, Medicare, Medicaid, etc.).
The code set copyrighted and maintained by the American Medical Association is called the Current Procedural Terminology (CPT) code. In 1983, an agreement between the HCFA (the government’s Health Care Financing Administration, which is under the Department of Health and Human Services) and the AMA made the CPT the sole coding system that could be used for billing Medicare. This monopoly completely squeezes out alternative and integrative medical practitioners.
The AMA’s codes are for treatments by conventional medical doctors, in allopathic medical care systems. There are no codes for complementary and alternative medicine (CAM) because the AMA doesn’t deal in that type of medicine; for them to create CAM codes would in fact be a conflict of interest.
There is a competing system that can fill those gaps: the ABC codes—a system of 4,400 new codes specifically designed for those 4,300,000 non-MD practitioners working in professions such as nursing, behavioral health, alternative medicine, ethnic and minority care, midwifery, and spiritual care. They are important for a number of reasons:

  • they are HIPAA-compliant (HIPAA is the Health Insurance Portability and Accountability Act; passed by Congress in 1996, it allows for people to transfer and continue their health insurance coverage when they change or lose their jobs, mandates industry-wide standards for healthcare information on electronic billing, and requires the protection and confidential handling of protected health information);
  • they can be used by both licensed and non-licensed healthcare practitioners on standard claim forms;
  • they complement existing code systems used in the allopathic setting;
  • they accurately document the care patients receive, covering a vast range of healthcare practices; and
  • they fulfill requirements imposed by both state medical boards and payers.

Widespread use of ABC codes is desperately needed so alternative medical providers can be fairly compensated for the services they provide, and can document and quantify the safety and efficacy of their treatments.
However, the AMA’s coding system is being spread across the board—and physicians are charged to use it, even though only 15–19% of practicing physicians are AMA members. And it’s a huge business. The AMA’s own website says, “The AMA is a successful business entity that generates approximately two-thirds of its annual $230 million operating budget from non-dues sources”—which includes the hefty fees to use the CPT codes.
In 1997, the US Court of Appeals, Ninth Circuit, ruled that the AMA’s exclusivity agreement with HCFA for using CPT “gave the AMA a substantial and unfair advantage over its competitors” and “constituted a misuse of the copyright by the AMA.” The court did not address whether the AMA’s conditions and high prices for a licensee’s use of the CPT code constituted violations of anti-trust law as well.
In 2001, when he was Senate Minority Leader, Trent Lott (R–MS) asked the Department of Health and Human Services to clarify the exclusivity arrangement it had with the AMA’s coding system. In response, the HHS approved a two year pilot project using the ABC codes. The pilot project was an amazing success, providing stunning statistics in a report showing the need for a revised billing code system—one that would include billing codes for ALL health practitioners.
According to ABC Coding Solutions, which developed the ABC codes, the AMA is now open to other coding systems, and ABC codes can work with CPT and provide supplemental information for billing, but the government has been unwilling to implement any changes that would have a greater effect on the healthcare billing system. Our Action Alert to the DHS this week asks for the incorporation of these integrative codes.
As we pointed out last week, doctors often have their hands tied by healthcare regulations. A doctor can be charged with a crime for billing an “unnecessary” treatment to the government or a private insurance company, because the CPT codes often do not allow for non-traditional services. This makes it difficult for doctors to bill their services accurately and puts them at risk of running afoul of government regulations.
There are several ways for an integrative doctor to reduce this risk. One is to not participate in any government program or accept private insurance.  Another is to avoid using the CPT codes and instead substitute the ABC codes—ABC will automatically convert its code to the AMA’s code for such billing purposes. This makes the treatment more likely to be covered, and it will therefore be harder to say that it is “unnecessary.” This can be  especially useful for an integrative clinic that is part of a hospital system that requires the AMA’s code.


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