Economics of Complementary and Alternative Medicine and Traditional Medicine
Although social, medical, and cultural reasons may account for why people in a given country prefer CAM and TM to conventional (Western) medicine, economic forces are also at play. This section describes the socioeconomic determinants of seeking treatment from traditional healers and providers of CAM; reviews the evidence on the cost-effectiveness of CAM and TM; and discusses cost-effective approaches to regulating, improving, and expanding the use of CAM and TM. Much of this evidence is from industrial countries; few studies have been conducted in or are applicable to low- and middle-income countries. This caveat is important for two reasons. First, the CAM and TM modalities discussed in this section may not be used in many developing countries. Second, the limited data on cost-effectiveness may not be applicable in the case of those countries. Nevertheless, the data give a rough picture of the relative cost-effectiveness of a number of CAM and TM practices.
Economic Factors That Influence the Use of Complementary and Alternative Medicine and Traditional Medicine
Users of CAM and TM approaches choose health practices that resonate with their beliefs about health (Astin 1998). Although economic factors play a role in this choice, the underlying incentives are not always predictable. For instance, a common misconception is that patients opt for CAM and TM services because they are cheaper alternatives to conventional medical care. Even though there are certainly instances when the cost of treatment using CAM or TM is much cheaper than the cost of accessing a conventional medical service, several studies have found that CAM and TM cost the same or more than conventional treatments for the same conditions (see, for example, Muela, Mushi, and Ribera 2000).
At least one study has shown that financial considerations are rarely the primary factor in choosing a traditional healer, ranking behind such reasons as confidence in the treatment, ease of access, and convenience (Winston and Patel 1995). In the United States, the average cost of a single visit to a Navajo healer was US$388, and the average annual cost of using a traditional healer represented roughly a fifth of the reported annual income of respondents in a survey (Kim and Kwok 1998). The high cost of using a healer was cited as the most common barrier to seeking care from this source. In Kenya, the average charge per patient per visit to a TM practitioner was K Sh 46 (US$4 in 1981), which was significantly greater than the average charge per visit even in private health care facilities (Mwabu, Ainsworth and Nyamete 1993). Finally, a survey in Zimbabwe reported that the median cost of consulting an herbalist was Z$23 per visit, compared with Z$1 for a government clinic and Z$29 for a private doctor (Winston and Patel 1995). The same survey found that outcomes tended to be better when patients went to government clinics (67.3 percent of visits resulted in a good outcome) than when patients consulted herbalists (50 percent of visits resulted in a good outcome).
TM is not always more expensive than conventional medicine, however. Survey respondents in Ghana reported that the cost of malaria treatment at a health clinic ranged from 1,900 to 3,000 (US$1.30 to US$2.00 in 1997), treatment at home using drugs bought from pharmacies or health care workers ranged between 200 and 1,000 (US$0.10 to US$0.70), and treatment by an herbalist was virtually free (Ahorlu and others 1997).
Another common misconception is that the poor are more likely to use TM. At least one study shows that this may not be true. In Zimbabwe, the mean monthly income of households visiting an herbalist, Z$877, was greater than the mean monthly income of households using government clinics, Z$718 (Winston and Patel 1995).
Although some traditional healers charge more than conventional practitioners, their fees may be negotiable, the method of payment may be flexible (often on credit or in exchange for labor), and payment may be contingent on outcome. The availability of an outcome-contingent contract favors TM over Western medicine when the disease condition requires providers to both exert effort in curing patients and induce patients to comply with their recommendations. Nonetheless, this strategy may be difficult to apply to the larger health care system.
Furthermore, patients tend to seek care from traditional healers for conditions such as mental illness, impotence, and chronic disorders, which they perceive as requiring greater involvement by the extended family and kinship group. Accordingly, the availability of financial support for seeking treatments for these disorders is greater than it is for illnesses such as malaria or diarrhea, for which patients more often seek conventional treatment.
Few published data are available on the financial costs of TM in low- and middle-income countries. The data presented here on the use of traditional healers are extracted from the World Bank's living standards surveys in Vietnam to provide one nationally representative snapshot of the situation. Of 28,254 individuals in the sample, 10,033 had consulted a health care provider in the four weeks preceding the survey. These consultations included both home visits and visits to a provider. Of the 10,033, 1,829 had been to a public provider, 1,431 to a private provider, 7,650 to a pharmacy, and 259 to a traditional healer.1 The most common reasons for visiting a traditional provider were headache, followed by cough and fever. The per visit drug cost for consulting a traditional healer was D 46, and the total cost per visit was D 51, compared with drug costs of D 38 and total costs of D 41 for going to a private clinic.
One commonly cited motivation for using CAM and TM is that their use might lower the incidence and costs of side effects associated with conventional treatments, but the published evidence on this point remains mixed. There is some evidence that CAM is used in addition to conventional treatments (Thomas and others 1991), but CAM may also have the effect of displacing conventional treatments. An outpatient survey found that, of 246 patients who had been receiving conventional treatment from the Royal London Homeopathic Hospital since the onset of care, a third had halted their conventional treatment and another third had reduced their intake of conventional medication (van Haselen 2000).2 The extent to which homeopathic treatment displaced conventional treatment varied by indication. The use of homeopathic treatment often replaced conventional treatments in patients with skin and respiratory infections; in patients with cancer, its use was purely complementary and therefore added to overall health care costs.
Thomas and others (1991) observe that patients who use CAM and TM also commonly access conventional medical care. In industrial countries, most CAM usage complements conventional care, but this is also common in developing nations. For instance, Mwabu (1986) provides evidence from Kenya that patients are likely to use more than one type of provider from the range of those available, such as government facilities, mission clinics, private clinics, pharmacies, and traditional healers. Furthermore, the choice of provider depends on patients' illness, condition, socioeconomic status, and education. If an initial visit to one kind of provider did not resolve the disease satisfactorily, a follow-up visit was made to a different kind of provider. Finally, the quality of care—including efficiency of service and waiting time at government and private clinics—is an important determinant of whether patients choose to go to traditional healers. Most traditional healers surveyed in a second study referred patients to Western practices for treatment when necessary (Mwabu, Ainsworth, and Nyamete 1993).
Economic Evidence
Although most studies tend to focus on a specific CAM or TM practice, Sommer, Burgi, and Theiss (1999) looked more broadly at whether the provision of CAM and TM services through prepaid health plans or government insurance reduces the overall costs of health care and found that it does not. A possible reason is that few individuals who are offered access to CAM use them, and those who do might access those services in addition to, not in place of, more conventional health services.
Studies that compare the cost-effectiveness of different CAM and TM approaches using the same analytical framework are rare. One such study in Peru looked at the costs and cost-effectiveness of treatment using conventional medicine and TM (EsSalud and OPS 2000). Complementary medical practices evaluated included acupuncture, homeopathy, tai chi, meditation, reflexology, hydrotherapy, naturopathy, and massage. Patients were enrolled in either the Western medicine group or the CAM group. Patients were not randomized between the two treatment groups, but they were matched by disease pathology and severity, age, and sex. Furthermore, selected patients had completed at least one year in the health system, as the investigators reasoned that this would enable them to evaluate their follow-up. Overall, the investigators found that complementary medicine was between 53 and 63 percent less expensive than conventional medicine for achieving equivalent levels of effectiveness. Complementary medicine was especially cost-effective for osteoarthritis, hypertension, facial paralysis, and peptic ulcers.
The rest of this section looks at the economic evidence on specific forms of CAM or TM.
Acupuncture
Lindall's (1999) study finds that an acupuncture referral for musculoskeletal conditions costs a mean of US$422, roughly 60 percent less than the cost of referral to a Western practitioner. However, this study was not randomized, and patients had to have failed first-line drug treatment before being offered the choice of second line-treatment, either with acupuncture or with Western medicine.
Homeopathy
Evidence indicates that the cost of homeopathic medication is lower than the average cost of allopathic products, which would be an economic factor in favor of its use if homeopathy were proven to be effective. A study by the National Health Service in the United Kingdom found that the drug costs associated with homeopathy were lower than those of allopathic practitioners (Swayne 1992). A four-year study of 100 patients that compared homeopathic drug costs with those of conventional drugs found an average cost saving of US$96 during the study period for those using homeopathic drugs (Jain 2003).3
Ayurveda
A study that compared medical expenditures over a four-year period for participants in a comprehensive program of ayurvedic-based natural medicine (which included antioxidant strategies, mind-body medicine, and other techniques) with participants whose expenditures were covered through a BlueCross BlueShield health insurance plan found that the expenditures for the ayurvedic group were 50 percent lower per person (Orme-Johnson and Herron 1997). However, the study was not randomized and failed to control for the inclination of only a subset of people to accept and remain compliant with ayurvedic approaches.
Chiropractic
Some studies found that spinal manipulation is less expensive than conventional treatments for episodes of back pain. One nonrandomized study found that the cost of chiropractic treatment over a five-year period, including both provider costs and equipment costs (US$28,902), was 24 percent less than the cost of Western pain therapy (US$38,029) (Kumar, Malik, and Demeria 2002). Moreover, 15 percent of patients in the chiropractic group were able to return to work, compared with none in the control group.
However, other larger and better-controlled studies failed to find a difference between chiropractic and physical therapy in terms of either outcomes or costs (Cherkin and others 1998; Skargren and others 1997; Skargren, Carlsson, and Oberg 1998). A study of adults with low back pain who were randomly assigned to physical therapy or chiropractic manipulation or were just given an educational booklet found no significant differences in either the mean costs of care or the outcomes between the physical therapy and chiropractic groups (Cherkin and others 1998). Three-quarters of the participants in these groups—who incurred costs of roughly US$430 over the two-year period of the study—reported that their outcome was either good or excellent, compared with a third of those who were assigned booklets; however, the mean cost of care for the booklet group was only US$153 for the two-year period.
Mind-Body Treatments
Little evidence is available on the cost-effectiveness of practices such as meditation and yoga, but the cost of acquiring the skills required for these practices, as well as the time costs of practicing them, are so low relative to conventional medicine that evidence of their clinical effectiveness might suffice to justify their use on economic grounds. Available evidence from clinical studies suggests that mind-body treatments can be cost-effective (Caudill and others 1991; Friedman and others 1995; Hellman and others 1990; Sobel 1995). Blumenthal and others (2002) find significant declines in coronary events and in predicted costs of care for patients who were assigned to a one-and-a-half-hour long weekly class on stress management, relative to usual care for each of the first two years of follow-up and after five years.
Beyond Cost-Effectiveness: Ancillary Benefits and Costs of CAM and TM
Although cost-effectiveness is one guiding rationale for determining resource allocations for expanding (or restricting) access to CAM and TM, additional societal benefits and costs, such as effects on biodiversity, must also be considered. CAM and TM could provide a rationale for conserving species, but overharvesting of endangered species for medicinal purposes is also a concern. According to WHO, 85 percent of the world's population (principally those in developing countries) depends on plants for medicine, and 25 percent of prescription drugs have an active ingredient derived from a flowering plant (Cox 2001). The possible extinction of medicinal plants is of concern not only to developing countries but also to industrial countries, as in the cases of poaching of American ginseng and overharvesting of native saw palmetto. Similarly, the reliance of Chinese TM on tiger genitals, bear gallbladders, and black rhinoceros horns has played an important role in poaching and threatens to wipe out these mega fauna.
Local knowledge and culture regarding the uses of medicinal plants may be important determinants of whether a certain species will survive (Etkin 1998). In addition to the biodiversity value of these saved species, scientists may be able to analyze these plants for potential clinical application on a broader scale than TM permits. Although preserving traditional knowledge of healing practices helps preserve the culture and identity of indigenous populations, CAM and TM may impose significant costs. In such instances, promoting conventional treatments that do not depend on endangered species may bring important benefits to society.
