Utilization management is commonly assumed to be a strategy payers implement to reduce healthcare cost. Although successful UM programs do result in reduced cost of claims, the focus of an effective utilization management program is improved quality of care.

When utilization management programs focus on denials – prioritizing cost savings over patient care – they often inadvertently add to the cost of a claim. Denying claims for the sole purposed of reducing cost can interfere with early intervention and result in more costly procedures down the road due to a delay in care.

Effective UM programs are based on providing the right patient care at the right time. These programs can be broken down into three key components – risk management, quality assurance, and utilization review.

Risk Management

Risk management aims to improve quality of care for patients and prevent avoidable costs through early intervention, preventative health, and education.

Early Intervention: Early intervention is used to stop the disease process, preventing a decline in the quality of life and high spending to fight the disease. The hope is that the existing disease process is completely reversed.

Preventative Health: Preventative health attempts to stop the disease from ever occurring by implementing healthy lifestyle choices. It also works to identify the potential disease process very early on to improve overall population health and in turn, lower costs.

Education: Educating patients with proper knowledge around the signs/symptoms of the disease allows for early identification and intervention. Education also provides patients with knowledge on best practices regarding annual check-ups, preventative care, and the benefits available to them through their insurance plan.

Utilization Review

Utilization review determines the appropriateness of the prescribed treatment plan to ensure a high quality of care and prevent unnecessary procedures. It is broken down into three phases of review: prospective, concurrent, and retrospective.

Prospective review – A review to evaluate the prescribed treatment plan before the treatment is performed to assesses the need for the healthcare services.

Concurrent review – Reviews performed at pre-determined intervals throughout the treatment process which primarily focus on the appropriateness of length of stay and initial discharge plans.

Retrospective review – A review performed post-discharge assessing the appropriateness of procedures, length of stay, and discharge to gain insights for quality management and risk assessment. is the process of assessing appropriateness of procedures, settings, and timings after the services have been rendered to ensure claim submissions contain correct billing codes for services provided.

Best Practices of A Successful Utilization Management Program:

Clearly Define Processes, Responsibilities, And Policies – A well-defined utilization review process ensures quality, repeatability, and sustainability.

Utilization Review Program Overseen By A Dedicated Physician Advisor –These advisors are imperative to any successful UM initiative as they are able to see the bigger picture when it comes to patient care – clinical financial, and legal aspects.

Strong Quality Improvement Program– Having a strong quality improvement program leads to more competent and consistent staff, more efficient handling of cases, increased quality results, and better patient outcomes.

Learn more about the best practices for a successful utilization management program 

Why you should consider a Utilization Management Provider

As outlined above, a successful utilization management program revolves around highly skilled, experienced clinicians who are able to see the bigger picture, prioritize quality, and improve patient care. With the labor shortages and nursing crisis currently crippling the U.S healthcare system, this may seem daunting, costly, or even impossible.

Outsourcing your utilization management can provide you with a dedicated team of experienced clinicians, allowing you to focus on patient care. With the right UM provider, you can scale your clinical teams, improve your quality scores, and reduce cost.

What To Look For When Selecting a UM Provider

Proven adherence to federal/state regulations – These regulations aim to prevent the misuse of medical resources and combat fraud, waste, and abuse in an expensive healthcare system.

A robust understanding of guidelines/criteria – A robust knowledge of healthcare policies, UM standards, and revenue cycle processes equips clinicians to be able to determine the most appropriate patient care

Nurses that work at the top of their licensure – Nurses who demonstrate critical thinking, problem solving, and good decision making skills have a better understanding of disease processes and provide better patient care.

Strong Training and QA Teams – Prioritizing quality results in more qualified clinicians, increased efficiency, and improved quality scores – all resulting in better patient outcomes and reduced cost.

Shearwater Health is a Full-Service UM Provider

With 3,000+ experienced clinicians and over 20 years of experience in healthcare, Shearwater Health provides dedicated clinical teams delivering improved quality of care, reduced cost, and improved clinical processes to 8 of the top 10 payers in the industry.

With 98.9% standard quality audits, 97% clinical decision accuracy, and URAC accreditation, coupled with an average 30-65% savings on direct labor costs, Shearwater health can help you scale and manage a successful utilization program.

Contact us today to find out what a utilization management partnership with Shearwater Health can do for your organization.