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Wednesday, March 21, 2001 - Page updated at 12:00 AM

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Regence to pay those who used alternative care

Seattle Times staff reporter

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Alternative health care in Washington - and people who use it - got a financial shot in the arm yesterday with the announced settlement of two class-action lawsuits totaling $30.4 million against the state's largest health insurer, Regence BlueShield.

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Regence BlueShield subscribers who think they may be eligible for reimbursement may call the company for more information at 206-464-3600.
The agreement, if approved by the courts, means that Regence subscribers who paid for visits to chiropractors, massage therapists, naturopaths, acupuncturists and nutritionists between Jan. 1, 1996, and Feb. 29, 2000, could be eligible for reimbursement.

In theory, all of Regence's 1-million-plus subscribers during that period could benefit, although lawyers representing the plaintiffs said fewer than half that number, and possibly as few as 20 percent, are expected to file valid claims.

Every subscriber should receive a claim form from the company within the next 90 days, said Richard Spoonemore, one of the plaintiffs' lawyers.

The settlement also would require that Regence use any money left over after all valid claims were paid to lower health-insurance premiums for all of its subscribers. And if the company sought state approval to raise health premiums within the next five years, it must show that was not an attempt to recover costs of the settlement, Spoonemore said.

A Regence spokesman could not be reached for comment.

The proposed settlement puts teeth in Washington's so-called every-category-of-provider law, which went into effect Jan. 1, 1996. The law, the only one of its kind in the country, requires health insurers to pay for care from an expanded list of alternative providers to treat medical conditions covered by the subscriber's policy.

Spoonemore and Jonathan Meier, his co-counsel in the case, said Regence failed to cover those costs for the majority of its subscribers, claiming alternative care was "not cost-effective or clinically efficacious."

"Regence discriminated against alternative providers by applying different standards to traditional and alternative medical treatments" in violation of state law, Spoonemore and Meier wrote.

In behalf of Regence subscribers, they filed or joined class-action suits in state and federal courts. Ultimately, the plaintiffs prevailed in the Washington Supreme Court and in U.S. District Court, where Judge Marsha Pechman found Regence liable for withholding benefits.

The settlement must be approved in King County Superior Court, which will also decide how much money in fees the plaintiff's lawyers will receive.

Carolyn Watts, a University of Washington expert on health economics, said it was too early to tell how much effect the case would have on the use of alternative health care or on the cost of health-insurance premiums.

Alternative care has been rising in popularity even among people who have had to pay for it themselves, she said.

A possible adverse effect for insurance customers, Watts said, is that the requirement for insurers to cover alternative care might cause them to cut health coverage in other areas.

"I think we just don't know" the full impact yet, Watts said.

The effect could be intensified by another class-action case in the works. Premera Blue Cross subscribers, represented by the same lawyers, are challenging the company's $500 cap on reimbursements for alternative care, although that limit is gradually being phased out under an agreement with the state Office of the Insurance Commissioner.

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