The Office of General Counsel issued the following opinion on August 26, 2004, representing the position of the New York State Insurance Department.

Re: Chiropractic Treatment, Participating Provider, Payment by Health Maintenance Organization


Is the methodology utilized by ABC Health Plan (ABCHP) to calculate payments to participating chiropractors violative of 1997 N.Y. Laws 426?


There is no methodology or fee schedule mandated by statute or regulation for calculation of reimbursement by health insurers or Health Maintenance Organizations of chiropractors.


The inquirer is a chiropractor who has contracted to provide services to subscribers of ABCHP, which is an HMO holding a Certificate of Authority from the Commissioner of Health in accordance with New York Public Health Law § 4403 (McKinney 2002. The inquirer alleges that, unlike the Center of Medicare and Medicaid Services (CMS) of the United States Department of Health and Human Services, which reimburses under Medicare for services provided by a chiropractor at 100% of the amount reimbursed for those same services provided by a physician, ABCHP reimburses for such services provided by a chiropractor to its subscribers at 65% of the amount that the HMO will pay for those some services provided by a physician. The inquirer asserts, therefore, that ABCHP is in violation of 1997 N.Y. Laws 426.


While the subscriber contracts issued by HMOs are subject to regulation by the Insurance Department as if they were subscriber contracts of not-for-profit health insurers, New York Public Health Law § 4406(1) (McKinney 2003), the contractual relations between an HMO and its participating health care providers are primarily regulated by the Health Department. Therefore, while the Health Department should address the specifics of the inquirer's complaint, the Insurance Department has reviewed the inquirer's allegations for any effect on the insureds and subscribers of all types of insurers, including HMOs, who may utilize chiropractic services.

Section 1 of 1997 N.Y. Laws 426 sets forth the Legislative intent:

The legislature recognizes that multiple health professions are trained and licensed to diagnose and treat the same or similar conditions through the use of modalities, therapies, services and philosophies that vary from profession to profession. It is the specific intent of this legislature to assure that health insurance policies, plans and contracts that provide coverage for the diagnosis and treatment of conditions, complaints, ailments, disorders or injuries by any health care profession, that may be diagnosed and treated by a doctor of chiropractic, must provide access to and equivalent coverage for the diagnosis and treatment of those conditions, complaints, ailments, disorders or injuries by a duly licensed doctor of chiropractic, within the lawful scope of chiropractic practice even if different terminology, philosophy, services, treatments or modalities are used by the various health professions; and such equivalent coverage shall not be abridged by any regulation heretofore promulgated or to be promulgated.

Among the substantive changes made by 1997 N.Y. Laws 426 was the enactment of New York Insurance Law § 4303(y) (McKinney 2000 and 2004 Supplement), regulating the subscriber contracts of not-for-profit insurers, which, because of the managed care nature of coverage provided by HMOs, would be applicable to that type of insurer:

(1) Every contract issued by a health service corporation . . . which is a "managed care product" . . . that includes coverage for physician services in a physician's office, and every "managed care product" that provides major medical or similar comprehensive-type coverage, shall include coverage for chiropractic care, as defined in section six thousand five hundred fifty-one of the education law, provided by a doctor of chiropractic licensed pursuant to article one hundred thirty-two of the education law, in connection with the detection or correction by manual or mechanical means of structural imbalance, distortion or subluxation in the human body for the purpose of removing nerve interference, and the effects thereof, where such interference is the result of or related to distortion, misalignment or subluxation of or in the vertebral column. However, chiropractic care and services may be subject to reasonable deductible, co-payment and co-insurance amounts, reasonable fee or benefit limits, and reasonable utilization review, provided that any such amounts, limits and review: (a) shall not function to direct treatment in a manner discriminative against chiropractic care, and (b) individually and collectively shall be no more restrictive than those applicable under the same policy to care or services provided by other health professionals in the diagnosis, treatment and management of the same or similar conditions, injuries, complaints, disorders or ailments, even if differing nomenclature is used to describe the condition, injury, complaint, disorder or ailment. . . .

. . .

(5) The coverage required by this subsection shall not be abridged by any regulation promulgated by the superintendent.

The Memorandum in Support of the legislative proposal, Senate Bill 5994 (Sen. Velella), that became 1997 N.Y. Laws 426 provided:

There has been concern expressed about the cost impact of including a mandate for chiropractic services as a required part of a health insurance benefit package. This bill addresses this concern by permitting insurers and HMOs to subject chiropractic coverage to reasonable deductible, co-payment and co-insurance amounts, benefit limits and utilization review requirements. However, such limitations must not operate in a manner discriminative against the chiropractic school of practice.

The Medicare program covers chiropractic services within the scope of practice of a chiropractor under the same conditions as if a physician provided the services. 42 U.S.C.A. § 1395x(r)(5) (West 1982 and 2003 Supplement). The regulations under which CMS operates, 42 C.F.R. §§ 410.20(b)(5) (2000) and 414.2 (2000), also require that chiropractors operating within their authorized scope of practice are to be reimbursed in the same manner as physicians. The actual methodology, 42 C.F.R. § 414.20 et seq (2000) as the inquirer correctly indicates, is based on a complicated relative value calculation.

By contrast, there is no statute or regulation in New York that requires that services of a chiropractor be paid for in an equivalent manner as the services of a physician. Nor is there, outside the context of automobile no-fault or workers’ compensation, any statute or regulation prescribing fee schedules for chiropractors.

Accordingly, the Insurance Department cannot conclude, based upon the information the inquirer furnished, that ABCHP is in violation of 1997 N.Y. Laws 426.

For further information you may contact Principal Attorney Alan Rachlin at the New York City Office.