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Employers are steering workers toward a controversial stem cell therapy

A stem cell clinic has persuaded over 100 employers to include its controversial therapy in their health insurance plans.
Source: Nati Harnik/AP

A Midwestern grocery chain, Hy-Vee, is taking an unusual — and highly controversial — approach to reducing health care costs.

Before employees in certain cities can undergo knee replacement, they first must visit a stem cell provider. Hy-Vee has contracted with one of the United States’ leading stem cell companies — Regenexx, based in Des Moines, Iowa — that claims injections of concentrated bone marrow or platelets can help patients avoid expensive joint surgery.

Regenexx has persuaded over 100 employers to include its services in their health insurance plans. In a marketing booklet, Regenexx, whose injections range in price from $1,500 to $9,000, notes that its treatments cost a fraction of major surgery. A single knee replacement, for example, ranges from $19,000 to $30,000 in the U.S.

The benefits of stem cells are hotly debated in the medical community, and federal regulators have warned the public to beware of clinics that peddle unapproved injections as a cure-all. Many doctors and ethicists say they fear the public is being misled about how well stem cells work — and whether the procedures save their money or waste it.

“This definitely is not a high-quality, proven treatment,” said Dr. Freddie Fu, chairman of orthopedic surgery at the University of Pittsburgh Medical Center.

Knee pain and the bottom line

Health insurance typically doesn’t cover stem cell injections, with, such as and Aetna, the United States’ third-largest health insurer, dismisses and as; Anthem, the country’s second-biggest health insurance provider, classifies the injections as “.” Without insurance coverage, patients are forced to pay out-of-pocket or forgo treatment.

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