Medical Management

How utilization management drives patients to the right kind of health care

The Institute of Medicine estimated 30 percent of health care spending in 2009 was wasted. Patients get duplicate services, unneeded services or services that haven't proven to have medical value, which is where medical management can help.

Utilization management enables health plan members and network providers to contact a benefits manager to determine whether services are medically necessary before they are rendered, says Dr. Robert Sorrenti, medical director at HealthLink.

Years ago, physicians, hospitals and providers strongly opposed utilization management, feeling it intruded upon their ability to make decisions. Today, there is acceptance, along with strong interest from those paying for health plans.

"It's evolved," Sorrenti says. "I can't say providers embrace it and love it, but we're at a time where people accept this as a tool to help manage some of the utilization that takes place."

What's the benefit of utilization management services?

Utilization management moves people to getting the right quality of care at the right time through evidence-based medicine. If you don't medically need a service, you really shouldn't get it. CAT Scans involve a lot of radiation, one MRI can lead to another, and certain procedures with unproven outcomes can be deleterious in the long run.

The bottom-line is: Managing expensive and sometimes unnecessary services will result in health care that is less expensive for employers and health plan members. As plan sponsors, employers have taken a renewed interest in medical management, particularly those struggling to keep pace with health insurance cost increases. They are looking for ways to control that without shifting all cost back to their members.

How does utilization management determine what is, or isn't, medically necessary?

Health benefits managers, who are accredited through organizations like URAC, employ an extensive process to determine if a service is medically necessary. They utilize medical policy and clinical guidelines to determine the appropriate rationale for carrying out a procedure or service, or using a particular drug. Then, they match up each member's situation with these policies and guidelines to see if the service makes sense.

Is time a factor with this kind of review?

No. Emergent procedures aren't reviewed, and with elective procedures there is time for due diligence. Accredited utilization managers have reasonable turnaround times - usually no more than three days - to get back to providers and members.

What services are typically reviewed?

In-patient days are reviewed to ensure patients are moved through the continuum of care. You don't want them staying in the hospital for $5,000 per day, waiting for a bed to open up in a skilled nursing facility where the cost is $1,000 per day.

Other services being reviewed are:

• Radiology services, particularly MRIs and CAT Scans.
• Drugs.
• Physical therapy. At some point, patients can continue the exercises at home.
• Sleep studies. Can a study be done at home, rather than at a costly lab or hospital?
• Durable medical equipment, such as wheelchairs, mattresses, hospital beds or braces. Are patients being persuaded to over-purchase or over-use?
• Nasal and eye procedures, to distinguish between cosmetic versus medical.
• Back surgery. This ensures a standard approach of time, medication, physical therapy and watchful waiting is followed before surgery. Back surgery has variable outcomes. You don't want to jump into it.

How else can employers deter over-use?

Many providers say patients are the ones demanding more services. Employers can empower plan members to have realistic expectations and be careful about demanding unnecessary services. Encourage them to take pride in the decision-making - be wise consumers and ask questions.

Download White Paper