Does Adding Alternative Medicine Cost Health Insurers More Money?

7-4. Complementary & Alternative Medicines
7-4. Complementary & Alternative Medicines (Photo credit: Peter Morville)

One of the major reasons given for not covering alternative medicine under insurance plans is that it would cost more money to cover those services.  The model is a simple one:  more coverage equals more usage equals higher costs.

But with the healthcare model adding alternative medicine something strange happens.  People take better care of themselves.  They use outpatient services rather than inpatient services.  When asked, they have significantly better self-reported health.

And, surprisingly, they cost less.   That’s right, we add more services and healthcare costs go down.  So why aren’t we adding alternative medicine everywhere?  Why isn’t it a major part of the healthcare discussion?

English: graph of age-adjusted percent of adul...
English: graph of age-adjusted percent of adults who have used complementary and alternative medicine: United States, 2002 (Photo credit: Wikipedia)

Here’s the study:

Med Care. 2012 Dec;50(12):1029-36. doi: 10.1097/MLR.0b013e318269e0b2.

The association of complementary and alternative medicine use and health care expenditures for back and neck problems.


Department of Orthopaedics, The Geisel School of Medicine at Dartmouth & Dartmouth-Hitchcock Medical Center, Lebanon, NH 03756, USA.



Health care costs associated with use of complementary and alternative medicine (CAM) by patients with spine problems have not been studied in a national sample.


To estimate the total and spine-specific medical expenditures among CAM and non-CAM users with spine problems.


Analysis of the 2002-2008 Medical Expenditure Panel Survey.


Adults (above 17 y) with self-reported neck and back problems who did or did not use CAM services.


Survey-weighted generalized linear regression and propensity matching to examine expenditure differences between CAM users and non-CAM users while controlling for patient, socioeconomic, and health characteristics.


A total of 12,036 respondents with spine problems were included, including 4306 (35.8%) CAM users (40.8% in weighted sample). CAM users had significantly better self-reported health, education, and comorbidity compared with non-CAM users. Adjusted annual medical costs among CAM users was $424 lower (95% confidence interval: $240, $609; P<0.001) for spine-related costs, and $796 lower (95% confidence interval: $121, $1470; P = 0.021) for total health care cost than among non-CAM users. Average expenditure for CAM users, based on propensity matching, was $526 lower for spine-specific costs (P<0.001) and $298 lower for total health costs (P = 0.403). Expenditure differences were primarily due to lower inpatient expenditures among CAM users.


CAM users did not add to the overall medical spending in a nationally representative sample with neck and back problems. As the causal associations remain unclear in these cross-sectional data, future research exploring these cost differences might benefit from research designs that minimize confounding.

PMID: 23132198

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