Controlling Costs and Changing Patient Care? The Role of Utilization Management (1989) / Chapter Skim
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The Utilization Management Industry: Structure and Process
The Utilization Management Industry: Structure and Process
Pages 58-90
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From page 58... ...
What it found about prior review procedures is described in this chapter. Chapter S covers high-cost case management.
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From page 59... ...
This does not equate to 1,000 review organizations, however, because many review companies alter some details of their programs to fit particular client preferences. (The Mayo Clinic, for example, reported dealing with over 200 Blue Cross and Blue Shield review programs, but there are fewer than 75 Blue Cross and Blue Shield organizations in existence.)
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From page 60... ...
From 1982 to 1986, the percentage of Blue Cross plans reporting prior review programs
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From page 61... ...
Third-party administrators, which began by specializing in processing claims for self-insured employers, have also diversified into prior review. In addition, a few community coalitions are administering utilization management programs for employers.
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From page 62... ...
The visits generally consumed a full day and focused heavily on the details of the operation of preadmission review and high-cost case management programs. The committee asked the utilization management organizations that it visited for examples of contracts with clients.
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From page 63... ...
The entity that organizes and manages the network may act simply as a broker that does not accept economic risk for the cost of services delivered by network providers. Alternatively, the organization may accept risk, typically 1The implied distinction arises because insurance companies and Blue Cross and Blue Shield plans may either act as an insurer (accepting actuarial risk)
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From page 64... ...
The committee, however, has not focused on the utilization management activities of institutional providers of health care for several reasons. Most hospitals have been responsible for utilization review and discharge planning for many years, so hospital-based prior review is a less dramatic change from past prac
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From page 65... ...
As Appendix B points out, this also holds true for many organizational differences among HMOs. Even though the organizations visited do not represent the full range of organizations that carry out utilization management activities, the committee found many noteworthy variations in the ways that utilization management is designed and implemented.
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From page 66... ...
First, all programs offer some or all of the prior review and high-cost case management activities described in Chapter 1. Second, all rely on telephone rather than face-to-face contact with the patient or physician.
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From page 67... ...
STRUCTURE AND PROCESS Review Criteria Met Initially or Following Discussion with Reviewer Notice Sent to: · Patient/Employee · Physician · Hospital · Claims Payer FIGURE 3-2 Typical basic steps in the prior review process. 67 Attending Physician Pro poses Elective Admission Patient/Employee/Physician Calls Review Organization or Fills Out Prior Review Form Nurse Reviewer Assesses Information Medical Necessity/Appropriateness of: · Inpatient versus Outpatient Care · Prospective Days of Care · Proposed Length of Stay Review Criteria Not Met Care Referred to Physician Adviser Review of Record and/or Consultation with Attending Physician Adviser Ag rees Adviser Can not Certify Notice Sent to: · Patient/Employee · Physician · Hospital · Claims Payer
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From page 68... ...
Even organizations that have information about benefit plan provisions do not always have on-line information about whether a particular patient is still eligible for benefits or has left the employer, been dropped as a dependent, or joined another health plan. Moreover, some review organizations have no connection with the claims payment function and possess little or no information about the actual use of services.
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From page 69... ...
Another form of data integration takes place at some utilization management organizations whose activities are highly concentrated in a particular geographic area. PROs, Medicaid programs, Blue Cross and Blue Shield plans, HMOs, and PPOs operate largely in particular states or metropolitan areas, whereas the larger commercial insurance companies, third-party administrators, and independent review organizations often do business nationally and deal with a much more dispersed group of providers.
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From page 70... ...
Handling Telephone Calls In some utilization management organizations, the calls from patients or providers are answered centrally and passed along to the first available review nurse. In other organizations, review nurses answer calls directly.
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From page 71... ...
Organizations that use pencil anu paper or ~nnex~e ~e~epnone and computer systems may require the person who took the initial call to take follow-up calls. Since nurse rev~ewers and physician advisers spend much of their time on the telephone, this means that the hospitals, doctors, or patients who deal with the latter type of organization may have to make many calls before they reach the right individual.
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From page 72... ...
In one organization that the committee visited, the attitude is that attending physicians do not always know the right language to be used to gain approval of an appropriate admission. If nurse reviewers' believe that a patient probably needs to be admitted, they can give the attending physician's office the cues needed to gain approval.
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From page 73... ...
All utilization management organizations that were visited refer cases that fail screens to physician advisers. These physician advisers are expected to use their clinical judgment and experience to determine whether the services should be certified as medically appropriate.
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From page 74... ...
Companies also say that by approaching attending physicians as colleagues, physician advisers, are often able to obtain important additional information that was not provided to the nurse reviewer, and they can work out a satisfactory agreement with the attending physicians about the services that will be certified as appropriate. Some utilization management organizations, however, use their physician advisers in quite a different way.
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From page 75... ...
Of course, the use of part-time physician advisers is a less stable situation, since their practices may grow or they may assume full-time responsibilities elsewhere. However, with the growing physician supply nationally, review organizations in many areas of the country are able to find practitioners who can commit a certain number of hours per week to review.
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From page 76... ...
There are also major differences among utilization management organizations in how much physicians are involved in prior review. On the low side, the proportion of cases that go to physician advisers for review runs about 1 or 2 percent in two organizations visited and about 10 to 15 percent in five organizations visited.
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From page 77... ...
One organization states that its main review of its physician advisers' performance was by the nurse reviewers to whom the decisions are conveyed. Physician advisers are paid in several different ways, resecting the diversity of their arrangements with the review organizations.
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From page 78... ...
Utilization management organizations generally state a preference for negotiating agreement rather than attempting to impose decisions on attending physicians. This preference stems, in part, from reluctance among review organizations to risk legal liability for patient care decisions, but it also may reflect client wishes.
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From page 79... ...
Both of these types of exceptions criteria tend to be generic, and they are applied without reference to the particular diagnosis or procedure for which an aGmlSSlOI1 IS proposed. Hospitalization Criteria Utilization management organizations use a variety of criteria to determine whether an individual needs inpatient care.
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From page 80... ...
These criteria have been refined and are marketed in hard copy or computer disk versions by a handful of major vendors for use in both prospective and retrospective reviews. Most of the review organizations the committee visited base their hospitalization criteria either on the appropriateness evaluation protocol (AEP)
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From page 81... ...
Length-of-St~ Nonns 1b assess proposed hospital lengths of stays, most utilization management organizations use statistical norms based either on data published by the Commission on Professional and Hospital Activities (CPHA) or on data compiled by the review organization itself.
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From page 82... ...
However, one HMO visited initiates continued-stay review on the day when, on average, the first 10 percent of patients are or have been discharged. Most of the organizations visited do not use the length-of-stay norms to certify a specific length of stay as appropriate but, instead, use them as guides for scheduling continued-stay reviews.
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From page 83... ...
, some review organizations say they now refuse to certify the necessity of the services. lIow Criteria Are Adopted and Modified Many approaches are used to adopt or modify criteria, but virtually all involve the organization's medical director and physician advisers (or a committee thereof)
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From page 84... ...
However, criteria are often borrowed, licensed, or adapted from outside sources or are developed less formally through discussions among physician advisers. Utilization management organizations generally report that their criteria are in a continuous process of modification, although some also schedule periodic reviews for particular sets of criteria.
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From page 85... ...
It does not ordinarily suffice for a physician adviser to certify services on the grounds that he or she does not agree with the criteria. In some cases, medical directors and physician advisers cannot agree on how particular circumstances should be handled, and it is left to the discretion of the physician adviser who receives the cased In some organizations, the nurse reviewers have the power to select the physician adviser to whom a case will be referred.
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From page 86... ...
(Problems with different measures of program results are discussed in Chapter 4.) Discussions of reporting requirements during the site visits conveyed a clear sense that clients evaluate utilization management organizations based on their apparent success in reducing hospital utilization or holding hospital utilization to comparatively low levels.
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From page 87... ...
Some benefit plans require a third opinion if the second opinion does not confirm the first. Most programs, like those for preadmission review, require that the patient initiate the process with a call to the utilization management organization.
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From page 88... ...
Blue Shield of California, explicitly upheld the right of an insurer to challenge an attending physician's decisions about medically necessary care. A few states have passed laws regulating private review organizations (American Hospital Association, 1989~.
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From page 89... ...
This variation includes the roles and responsibilities of the nurses and physicians who are involved in the review process, the logistics of the process, the nature and availability of the criteria used in prior review, the types of decisions that are made, the appeals process, and reports of impact. Although review organizations vary in their inventiveness and willingness to tackle new issues of appropriate use, they generally follow the lead of researchers or medical groups in selecting targets for attention.
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From page 90... ...
However, as the next chapter reports, the limited evidence on the impact of prior review programs does not include any assessment of the link between differences in program characteristics and differences in program results. REFERENCES American Hospital Association, Private Utilization Renew, State Issues Forum Monograph Senes, August 1989.
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