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TITLE: AHCCCS; chiropractic care; report |
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SPONSOR: Barto |
STATUS: Senate Engrossed |
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PREPARED BY: Maggie Rocker
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Description
The bill would require AHCCCS to cover chiropractic services (up to 20 visits) that are ordered by a primary care physician or primary care practitioner for adults aged 21-64. The bill would also prohibit the Hospital Assessment as a fund source.
Estimated Impact
AHCCCS actuaries estimate the bill would have a 9-month fiscal impact of $2.4 million General Fund ($12.0 million Total Funds) in SFY 2022. The full-year cost of the proposal in SFY 2023 would increase to $3.1 million General Fund ($15.9 million Total Funds).
Beyond the first-year costs, AHCCCS' actuarial estimates will depend on actual utilization. Two factors could lower the cost beyond the first-year estimate. The long-run cost of the bill could be lower if AHCCCS enrollees utilize chiropractic services at lower-than-projected rates due to the requirement of a referral from a physician. The cost could also be lower if coverage of chiropractic care reduces the utilization of existing services to address neck and back pain. The magnitude of these impacts is difficult to determine in advance.
Though the bill would preclude the Hospital Assessment from covering chiropractic services, AHCCCS has indicated that it would be unable to limit the portion of capitation rate payments specific to chiropractic services to General Fund dollars without additional administrative resources. As a result, in addition to the direct cost of chiropractic services, AHCCCS estimates $100,000 would be required annually for the cost of 1 FTE position to comply with this provision. We concur that the Hospital Assessment exclusion may generate additional workload for AHCCCS staff, but we believe their $100,000 estimate to be overstated.
Analysis
AHCCCS provides acute care, behavioral health services, and long-term care services for Medicaid-eligible adults and
children. The acute care program currently covers chiropractic care for enrollees under age 21 through the federally
required Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) benefit, while individuals age 65 and older
receive chiropractic coverage through Medicare. The bill would extend coverage of chiropractic services ordered by a
physician or primary care practitioner to AHCCCS enrollees aged 21-64. The benefit would be limited to 20 visits unless the primary care practitioner determines additional visits are medically necessary.
The agency estimates that 4.9%, or 42,000, of AHCCCS' non-elderly adult enrollees would utilize chiropractic services with
an average of 5.3 office visits per year. These utilization estimates are based on 2018 ADOA health plan data.
AHCCCS then applied its fee-for-service reimbursement rates to its assumed utilization rates to estimate the fiscal impact.
AHCCCS estimates the bill would cost $3.1 million General Fund ($15.9 million Total Funds) annually, including $99,700 for county costs associated with elderly and physically disabled enrollees in the Arizona Long Term Care System (ALTCS).
Beyond this service cost, the agency estimates the bill's provision to exclude the Hospital Assessment would require $100,000 annually for the cost of 1 new FTE to separate the Hospital Assessment from the portion of capitation rate payments specific to chiropractic services. We concur that AHCCCS staff may be required to complete additional data analysis of chiropractic claims to exclude the Hospital Assessment, but the agency has not provided sufficient justification as to the need for an additional full-time position to complete such an analysis. For this reason, we believe AHCCCS' administrative cost estimate to be overstated.
(Continued)
In addition, AHCCCS' service cost estimate may overstate the overall cost of the bill for at least two reasons. First, given that the bill would require AHCCCS enrollees to receive a referral from a physician prior to seeking chiropractic care, the utilization of chiropractic services may be lower in AHCCCS than among state employees, who are permitted to see chiropractors without a referral.
The net impact of the referral requirement on utilization of chiropractic services by AHCCCS enrollees is unknown.
On the other hand, state employees have a required copayment for chiropractic care while many AHCCCS adult enrollees
have no copayment. Until January 1, 2018 the state employee copayment for chiropractic care was only $15. The state
copayment increased to $40 on January 1, 2018, but the impact of the copayment increase was not part of the AHCCCS
analysis.
Secondly, coverage of chiropractic care could result in reduced utilization of prescription drugs and other AHCCCS services used to treat neck and back pain, generating offsetting savings. AHCCCS did not attempt to estimate such offsetting savings in its analysis, as the agency believes any associated cost avoidance would materialize in the long run rather than the short run.
An August 2016 review by the National Academy for State Health Policy on the use of non-pharmacological alternatives for pain management in state Medicaid programs concluded that the cost impact of alternative pain management series compared to conventional pain management strategies "has not been adequately studied," and that the available studies have produced mixed findings. As a result, any estimate of net savings in pain management services associated with coverage of chiropractic care would be highly speculative.
Some initial studies of Medicaid pilot programs in other states that offer chiropractic care to select Medicaid enrollees
have suggested that chiropractic benefits could be associated with fiscal savings. Rhode Island's Integrated Chronic Pain
Program provides case management services by a nurse trained in chronic pain management for Medicaid-eligible chronic
pain patients with at least 4 emergency visits over a year and may include referrals to acupuncture, chiropractic, and
massage therapy services as appropriate. A September 2017 study found that the program reduced average medical
costs for participating members by (36)% compared to non-participating members. The savings were associated with
reduced utilization of opioid and other prescriptions, emergency room visits, and inpatients admissions.
A similar pilot program in Florida allowed certain Medicaid-eligible individuals with chronic fatigue, neck or back pain, or
fibromyalgia to receive case management services from a holistic nurse case manager, as well as acupuncture,
chiropractic services, and massage therapy. A study initially found a (9)% cost reduction for participating enrollees in the
first three years of the program, although there were no costs savings in the subsequent three years.
The savings from these programs, however, cannot be readily extrapolated to Arizona. In both Rhode Island and Florida,
chiropractic care was offered as part of a specialized comprehensive pain management program including access to other
services (e.g. case management, acupuncture, massage, etc.) and was restricted to certain patient populations. In
contrast, the bill would not directly create a comprehensive pain management program and would make chiropractic care
available to all adults as long as each enrollee receives a referral from a physician.
Other studies of chiropractic care in non-Medicaid populations have determined that increasing access to chiropractic
care increases overall health care expenses. A December 2014 analysis conducted by Compass Health Analytics on behalf
of the New Hampshire Department of Insurance studied the impact of cost-sharing on utilization of chiropractic care, as
well as secondary impacts on utilization of other medical services. The study found that lower chiropractic copayments
were associated with reduced utilization of non-chiropractic services, including reductions in the use of opioid-based
medications to reduce pain. Overall medical costs still increased, however, because new spending chiropractic care was
greater than the reduction in costs for other services.
As the literature review above suggests, the estimated impacts of chiropractic coverage on utilization of other services
varies. The net budgetary effects of any utilization changes are therefore uncertain. The bill would require AHCCCS to submit a report on chiropractic service utilization and any identified cost savings by January 21, 2024.
(Continued)
Local Government Impact
The bill would generate an estimated $99,700 in costs for counties as a result of chiropractic services rendered to enrollees in ALTCS.
1/29/21