Health insurers work hard to make sure their members get the right health care in every care setting. Insurers employ medical directors and clinical staff who, using nationally accepted, evidence-based criteria, determine medical appropriateness of prescribed services. Monitoring and communicating with health care providers ensures that appropriate resources are utilized in the correct inpatient or outpatient setting.
Coverage decisions are made based on medical necessity and the benefits available in the member’s specific health plan. The insurer’s medical staff reviews things like:
- Medical records or clinical documentation
- Plan of care for the patient and services provided
- Procedures, therapies, progress during the hospital stay
- Types and amount of medicine given
- Home services, equipment or follow-up appointments needed
Review of these things confirms the care being given is needed and no unnecessary services are being performed. This is called utilization management.
To give the best care possible and to use health care dollars wisely, the care being given must meet these criteria:
- It must be medically necessary.
- It must be appropriate for the individual.
- It must follow clinical best practices.
Some types of services must be approved before being performed (pre-authorization). When a service requires pre-authorization, it is the job of the provider, or the member and provider, to submit clinical information to the insurer. The insurer’s medical director and clinical staff then follow the plan’s medical coverage policies and decide whether the request meets the criteria for medical necessity.
Bottom Line: Utilization management ensures that insurers make correct coverage decisions and members receive optimal, cost-effective outcomes with a focus on quality care. This means the money you spend on your group plan is used wisely.
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