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Tuesday, January 27, 2009

One Thing You Need to Know About How Health Care Works

There are, and always have been, people who seem to have a knack, like folks selling things at the fair, of getting you to believe they know just about everything there is to know about a subject. It is more of a concern when the people involved have no background in health care or related fields.

Recently I was provided with a promo piece pushing a spendy program alleging to be the one source you need to purchase at $125 - after your $70 discount - that includes a 243 page digital publish-on-demand book and a set of CDs.

Having been in the health care industry for too long of a time there is not much that has really changed over the decades and not much I don't know about what's happening now.

If you are gullible enough to buy in to this website promotion, along with their other very superficial material, then I feel sad for you.

While I am a staunch supporter of health care freedom and have been for the majority of my life, I'm not for the Barnum & Bailey approach to educating people about it.

I'll openly recommend that you skip the fluff and forget to buy the $125 deal after your $70 discount.

I'll also openly recommend that you start here with an article written by a medical professional who knows a lot more about the facts. Certainly much more than a self-proclaimed "expert" who claims to have a 1200 digital book library.

Posted with permission of the author -
The Healthcare Codes Monopoly
Dr. Carolyn Dean MD ND
Originally Published in Total Health for Longevity, June 2006

Most people have no idea that there is a healthcare codes monopoly and don’t even know what it means. It’s time we did.

Billing Codes
The billing system of American healthcare is based on a complex coding system called Current Procedural Terminology (CPT codes). Established in 1966 by the American Medical Association (AMA), the codes garner the AMA hefty annual licensing fees. Each time a CPT code is used, the AMA gets paid.

There has never been a law against including codes to cover all healthcare practitioners but the AMA has developed very few codes for non-medical practitioners. This keeps other practitioners from becoming equal business partners in the world of insurance reimbursement for services rendered.

CPT codes are designed to document what a medical doctor does for a patient. Think of a department or grocery store where every item has a bar code, and if it doesn’t, the item can’t be sold without a clerk running back to the aisle to find the price. Swiping a bar code across the cashier’s scanner not only calculates the price, but also automates inventory control and financial management. It’s the same for healthcare, without a code there is no way to calculate appropriate payment and no itemization of what has transpired. It’s that simple.

The current coding systems cover only a fraction of what is happening in healthcare—coded interventions are the only transactions that are tracked, marketed, and reimbursed. This is why so little is known about what transpires in the marketplace with regard to healthcare practitioners who are paid cash.

Without codes for all types of healthcare practitioners we can’t document the effectiveness of their care or the potential money that is saved by including them in insurance reimbursement. It’s a lose-lose situation. Patients lose, practitioners lose, and the nation keeps losing millions of dollars paid out to ineffective and costly drug-based medicine. For example, healthcare trends are tracked by data obtained from insurance companies. Since insurance companies can’t measure data they don’t have, they have no way of knowing, for example, that patients who see midwives have a much lower rate of cesarean section, about 10-15%, compared to patients who are delivered by obstetricians with over twice the rate –of about 30%.

Lack of relevant data is also why we can only depend on small samples and surveys to tell us what forms of natural healing arts people are using because we have no other way of gathering the data.

It’s Getting Worse, Not Better
There used to be state codes (HCPCS III) that individual states created to meet their needs. The state codes were abolished in 2003, costing many states’ Medicaid programs millions of dollars.

Square Pegs in Round Holes
Being required to fit everything a practitioner does into an allopathic/medical code leads to a high degree of inexactness. Because CPT codes include very few non-medical modalities, many doctors must limit their practice to allopathic medicine—so they can get paid by insurance, which, in turn, limits the type of care available to the public. Practitioners who use non-allopathic modalities have to fit their care into a CPT code—square pegs into round holes. For example, all states allow nurse practitioners to bill directly for their care, but they lack appropriate codes. So, while insurance companies may direct them to bill using CPT codes, the American Nurses Association has determined that CPT codes do not describe or document that the care is from a nurse. ABC codes solve this problem, for all practitioners by giving each practitioner their own set of codes.

State of Exclusion
Due to discrepancies in state “scope of practice laws”, insurance companies don’t know the scope of practice for each type of practitioner in each state, and because of potential legal liabilities, they just don’t pay for these services. To be fair, they don’t want to pay a claim illegally, but it suits them just as well to not pay –it saves them the hassle of processing claims without codes.

This graph shows practitioners left out by the medical monopoly in coding:

ABC Codes
Knowing the limitations of the CPT codes, a unique company called ABC Coding Solutions developed “ABC Codes” that describe services, remedies, and equipment items used by all healthcare practitioners, not just medical doctors. And, they include codes for most aspects of alternative medicine as well including homeopathic remedies.

Ms. Giannini, the CEO of ABC Coding Solutions knew the healthcare system was unhealthy. But it wasn’t until she experienced a chronic illness that she became a victim of it herself. She struggled with her illness for two years, going to medical doctors who billed her insurance company a total of $15,000 -all legally coded and absolutely ineffective. After none of the medical treatments worked, it only took a few visits and with a doctor who provided care that was not in the CPT codes, and $500 in out of pocket expenses, to get her well.

Ms. Giannini found it incredible that an insurance company would gladly pay $15,000 for treatments that didn’t work and refuse to pay $500 for treatments that did. The doctor that helped her get well is one of millions of practitioners forced to operate outside the “system”, which also forces millions of patients like Ms. Giannini outside as well.

Playing Monopoly
The AMA was told by the federal government in 1993 to create codes for non-MDs, but they haven’t complied. It’s like asking Ford to create service and supply codes for Chrysler! Nobody is going to willingly stop something that works in their favor. Nurses have tried for decades to get nursing codes by participating on a coding panel with the AMA without much luck. And, as of 2006, out of over 8,000 CPT codes for medical care, there are only four CPT codes for chiropractors and acupuncturists, and massage therapists have one code.

Cut the Bureaucracy
ABC Coding Solutions keeps current on the legal scope of practice of all practitioners in all 50 states and ABC codes legally reflect the practices of more than 3 million underserved healthcare practitioners. But they are not meant to supercede the current codes; when used together with CPT and government codes, ABC codes support a complete, accurate, and precise documentation of patient encounters and a common language for comparing the economic and health outcomes of competing approaches to care. The fact that ABC Coding Solutions can determine if a code is legal or not saves billions in administrative costs spent haggling over inappropriate codes.

ABC Coding Solutions estimates that using ABC codes will save more than $51 billion per year in U.S. healthcare costs when implemented across the healthcare industry.

Using the example of the Medicaid Behavioral Health Department in Alaska, by using ABC codes in place of state codes that were retired in 2003, this department saved $2 million in one year. This department has thus far used ABC codes to process more than 500,000 health claim and payment transactions. A Medicare Advantage plan in New Mexico has paid claims on ABC codes for over five years with similar outstanding results.

Having ABC codes will not change healthcare overnight—but ABC codes are a big step in the right direction. Unlike technologies that cost millions and take years to return a profit, ABC codes are a turn-key operation and begin saving everyone money immediately.

With ABC codes, insurance companies, government and the public will have information to make informed decisions on healthcare spending and reimbursement.

Consumer Directed Healthcare (CDHC)
CDHC and Health Savings Accounts (HSAs) are an attempt to “solve” the problem of rising healthcare costs. They raise consumer awareness about the real costs of healthcare and help people make better decisions about how to spend their healthcare dollars. However, they are currently set up using only the medical model of care and AMA CPT codes. They do not currently address the demands of millions of people who want alternate options to prescription drugs and surgery.

ABC codes, however, allow all practitioners to effectively document their care and thereby potentially participate in insurance reimbursement and HSAs. Thus ABC codes will help maximize the benefits of HSAs by providing consumer access to a wider variety of caregivers.

What You Can Do
ABC codes have been in use since 2003. However, ABC codes need to leap over one more hurdle. They need to be named a permanent government standard so that insurance reimbursement will be also become standard for all types of health care.

ABC codes are authorized for use through October of 2006. We have until then to lobby our elected officials to have ABC codes made a government standard. Please visit for information on how you can urge your elected officials to break the healthcare codes monopoly. From there you can send your elected officials an email urging them to support naming ABC codes a permanent government code-set. You may also contact ABC Coding Solutions at 1-877-621-5465.

We don’t need more caregivers in America, instead we need to rethink coding. Coding is creating an artificial bottleneck for direct consumer access to quality healthcare. Consumers are demanding choice in healthcare. You can help create choice by demanding that ABC codes are available to document the care that consumers are already using.

Carolyn Dean M.D., N.D. is a medical doctor, naturopathic physician, researcher, educator, and wellness consultant. She has written eleven highly-acclaimed books, the most widely read is The Miracle of Magnesium along with her most recent, The Yeast Connection and Women’s Health, IBS for DUMMIES, and Hormone Balance: A Woman’s Guide to Restoring Health and Vitality. Dr. Dean disseminates the message of health and self-responsibility in both private Wellness Telephone Consultations and at public seminars. You can find her at

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