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Utilization Management Plays Vital Role in Care Coordination
Traditionally, the purpose of utilization management is to evaluate medical necessity, appropriateness, and efficiency of healthcare services, procedures and facilities under plan provisions. Utilization programs usually include prior authorization (prospective review), concurrent review and, in some cases, retrospective review. When utilization management services are first implemented, they generate a reduction in costs of about 4 percent, on average. As providers learn the plan provisions, the hard savings level off and are replaced by the soft savings of cost avoidance – often referred to as the sentinel effect. As a program matures, additional hard savings can be found when new services, such as imaging or durable medical equipment, are added. A hidden value of today’s utilization management programs – one that is vital to care coordination efforts – is the program’s ability to identify members early in the disease process and connect them with case and/or disease management programs. These coordinated care programs contribute not only to direct healthcare cost savings, but to improved patient outcomes, greater employee productivity and decreased absenteeism. In addition to traditional utilization management services – certification, concurrent review and discharge planning, all designed to help plan sponsors manage claims costs – utilization management vendors are now offering enhancement to coordinate care or focus on specialized needs. This allows the customers to have the flexibility to configure their benefit structure to address the high volume and costs associated with such services as outpatient rehabilitation services review, imaging review and chiropractic review. Healthcare spending in the United States continues to rise, with expenditures consistently outpacing inflation and workers’ earnings. To better control costs and improve medical outcomes, care coordination will continue to evolve, and innovations and best practices will emerge in utilization management, case management and disease management. Does implementing utilization management or enhancing your existing utilization management services require a radical overnight change? Not necessarily. Just taking some initial steps into the new hybrid utilization management products can bring noticeable changes that may help derive cost savings. |
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Care coordination provides a framework for information sharing in order to “maximize the value of services delivered to patients by facilitating beneficial, efficient, safe and high-quality patient experiences and improved healthcare outcomes,” according to the National Quality Forum. A cornerstone of a successful care coordination effort is utilization management. 
