UTILIZATION MANAGEMENT  – Class 5

Providing the right service at the right time by the right provider in the right place

Providing the right service at the right time by the right provider in the right place may be one way to describe utilization management.  Utilization management performs important functions such as: it attempts to assess the appropriateness of diagnostic and therapeutic modalities for individual Managed Care Organization’s members and to ensure that members do not receive unnecessary services. Utilization Management can be used to screen and exclude cost outliers such as Managed Care Organization’s physician-gatekeepers who “overspend”.

Some Concerns by Some Practitioners With Utilization Management:

  • Disagreements among peer reviewers about what comprises appropriate care
  • Uncertainty about reviewer qualifications
  • Uneasiness about reviewer requests for confidential patient information
  • Physicians might feel utilization management forces them to choose between being a patient advocate and a Managed Care Organization’s agent

Physicians cannot think of themselves as an isolated island anymore but have to see themselves in terms of how they fit in the whole system of health care delivery. What the HMO’s are managing is not only each individual doctor but they are managing a whole system and they are looking at how everything interacts: how the doctors interact to each other, the doctors to the hospitals, the specialists to the PCP’s, the clinics to the hospitals, the hospitals to each other. What you as new doctors have to understand is this whole health care delivery perspective.

Past joke: Drive through Delivery: “POSITIVE THOUGHTS REGARDING THE EIGHT-HOUR DISCHARGE”

The American Medical Association reports that utilization management is the single factor that interferes most with physician’s clinical decision making. Preadmission or pre-procedure certification and retrospective review were named as the most intrusive and most time consuming.

Practitioners also report disagreements among peer reviewers about what comprises appropriate care, uncertainty about reviewer qualifications, and uneasiness about reviewer requests for confidential patient information. Physicians might feel that utilization management forces them to choose between being a patient advocate and an MCO agent.

An internal memo that was printed in Harper’s Magazine in February, 1996 explained to doctors in the Obstetrics and Gynecology wing of the Kaiser Permanente Hospital the Hospital’s new policy in Los Angeles for discharging new mothers earlier than before, in most cases as soon as eight hours after delivery. This memo states the following:

POSITIVE THOUGHTS REGARDING THE EIGHT-HOUR DISCHARGE

Benefits for staff:

  • Fewer rounds, less charting, less vital-sign monitoring
  • Streamlined paperwork
  • Reductions in our overhead costs will allow us to remain competitive in a fluid marketplace and thus retain our jobs and attract more patients

Benefits for patients:

  • Childbirth is a natural event, and an early homecoming is a celebration of such
  • Bonding with an infant is an intimate pleasure that can best be pursued in the privacy of one’s own home
  • Better quality sleep at home in a familiar bed and environment
  • Siblings will be reunited with their mother and the new baby sooner
  • There can be unlimited visitors at home
  • Hospital food is not tasty

So, how does utilization review effect the physician? Some physicians may feel that they attend medical school for four years, do a residency, maybe do a fellowship and then go into private practice to have decisions second-guessed by nurses looking at things from what some call a medical cookbook. However, medical directors of HMO’s typically do not use the term “medical cookbook” and instead use the term “medical guidelines” because in their opinion it is not a cookbook because physicians maintain their own independent clinical judgment. A physician’s remedies are going to be determined by how well such physician can communicate with the medical director of the HMO’s in which such physician participates and work through that HMO system and what the contract says – and the legal system such as laws that may have passed that benefit providers and patients.

HMO’s are managing not only each individual doctor but they are managing a whole system and looking at how everything interacts

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