Utilization Review Organization Research Articles

A National Utilization Review of Tympanomastoidectomy for Adults with Chronic Suppurative Otitis Media

In the United States various forms of managed care have been introduced to control the use of expensive medical services. One of the most prominent involves utilization review of hospital admissions. While reviewing the appropriateness of inpatient treatment is appealing in principle, its application is made difficult by clinical uncertainty. Managed care plans develop and implement review criteria often without the guidance of clear clinical norms of treatment. Under these conditions, we suggest that utilization review organizations (UROs) can be expected to develop “styles” of review that respond to clinical uncertainty, influenced by their experience, professional orientation, and financial incentives. Two review styles are explored in this paper: standardization, where the URO reduces the variance in clinical practices by eliminating those practices that deviate from professional norms and stringency, whereby the URO shifts the distribution of clinical practice as it tries to change the professional norms of practice. Data from a 1992–1993 national survey of utilization review organizations are used to test whether UROs have review styles that systematically respond to organizational attributes, economic pressures, and clinical uncertainty associated with three medical conditions: cardiac catheterization, low back pain, and adolescent depression. UROs were found to adopt more stringent review strategies for conditions with weaker norms of appropriate treatment. Financial incentives and organizational experience are positively related to greater stringency. Standardization responds to professional orientation and organizational experience. Variation in the review styles of UROs has implications for the resulting distribution of clinical practices as well as the equity of access to medical care.

Equitable peer review.

A economist asked a group of physicians if they knew what was the most expensive piece of medical equipment. Most physicians believed it was a magnetic resonance imager. The economist said they were wrong. “It’s this,” he replied, waving a pen in the air. The physicians jeered, but they knew where he was coming from. Decisions made by doctors have more impact on health care expenditures than any other factor. Studies have shown that 10 to 20 percent of hospital admissions and 20 to 30 percent of total inpatient days are inappropriate or unnecessary based on accepted medical criteria (1). Peer review is the most widely used method to curb utilization and ensure appropriate use of clinical resources. From hospital peer review committees to national utilization review organizations, peer assessment has become the cornerstone of medical utilization management as currently practiced. Now that capitation has forced providers to monitor their medical decisions closely, peer review has taken on an even more important role. Whereas accountability in feefor-service medicine is imposed externally by managed care organizations, capitated arrangements provide physicians with incentives to monitor themselves under the watchful eyes of senior colleagues. Either way, treatment is inspected and controlled to ensure that medical standards are met. Providers at financial risk adopt the same utilization management techniques as the managed care companies they loathe (2). A good part of my professional life has been spent as a peer reviewer. I have worked on both sides of the river—for managed care organizations and for direct providers of care. In the latter context I was appointed to the “hospital bed police.” My own practice has been subject to review as well. I believe that peer review is essential to the practice of medicine, although it shouldn’t be as adversarial as it is currently practiced. Modern peer review has turned into a completely one-sided affair, and it was never meant to be that way. My suggestions for making peer review equitable are discussed in this column. My remarks are limited primarily to inpatient treatment and are intended mainly for physicians conducting reviews. However, many of the guidelines that follow also apply to physicians undergoing review.

Risk, motives, and styles of utilization review: A cross-condition comparison

In the United States various forms of managed care have been introduced to control the use of expensive medical services. One of the most prominent involves utilization review of hospital admissions. While reviewing the appropriateness of inpatient treatment is appealing in principle, its application is made difficult by clinical uncertainty. Managed care plans develop and implement review criteria often without the guidance of clear clinical norms of treatment. Under these conditions, we suggest that utilization review organizations (UROs) can be expected to develop “styles” of review that respond to clinical uncertainty, influenced by their experience, professional orientation, and financial incentives. Two review styles are explored in this paper: standardization, where the URO reduces the variance in clinical practices by eliminating those practices that deviate from professional norms and stringency, whereby the URO shifts the distribution of clinical practice as it tries to change the professional norms of practice. Data from a 1992–1993 national survey of utilization review organizations are used to test whether UROs have review styles that systematically respond to organizational attributes, economic pressures, and clinical uncertainty associated with three medical conditions: cardiac catheterization, low back pain, and adolescent depression. UROs were found to adopt more stringent review strategies for conditions with weaker norms of appropriate treatment. Financial incentives and organizational experience are positively related to greater stringency. Standardization responds to professional orientation and organizational experience. Variation in the review styles of UROs has implications for the resulting distribution of clinical practices as well as the equity of access to medical care.

Ventilation tube placement in a managed care population.

To date, little information is available regarding the actual incidence of ventilation tube placement in a known population of pediatric patients. We evaluated the incidence of ventilation tube placement in a known population of pediatric patients whose health coverage is provided through a large managed care organization. Epidemiological data provided by a large managed care organization on a population of 67,995 children from July 1, 1993, through June 30, 1994, were evaluated. A primary care physician referral to an otolaryngologist was required for assessment, and precertification for ventilation tube placement was obtained using explicit criteria developed by a large national health services utilization review organization. In children younger than 24 months, 30.11% underwent ventilation tube placement compared with an overall incidence of 4.49% for all children younger than 18 years. The details of this study are presented to understand better the implications of the epidemiology of otitis media and how it relates to a physician's participation in a managed care organization.

Managed care is utilization review

The role of utilization review (UR) as a form of managed care is described. As technology has advanced, the use of diagnostic and therapeutic services has increased and care delivery has shifted to outpatient settings, but the increase in healthcare costs has not slowed. The shift to delivery of medical care outside the hospital setting has increased the need for effective UR in both inpatient and outpatient settings. UR is performed not only by private UR organizations and through external review programs of insurance carriers but also through care-providers' internal programs. UR has been driven by increased medical costs and by redesign of insurance benefit plans to include financial incentives and penalties and copayments. UR has attempted to control the use of hospital services through preadmission certification and concurrent review, requirements for second surgical opinions, and medical case management, which is the identification before or during hospitalization of patients who could safely receive treatment outside the hospital. In-patient mental health and substance-abuse programs have been the subject of intensive review because of high expenditures for such services. Practice indicators are being developed that will be used for prospective determination of treatment plans. As UR techniques improve, management of care in all organized health-care settings will intensify.

Managed health care and the Massachusetts experience

Managed health care, through prepaid health delivery systems and utilization review organizations, is perhaps the greatest trend in modern health care. The authors examine the remarkable growth of managed care and outline its clinical, economic, ethical, and practical implications. They then review examples of how organized psychiatry has been involved in managed care and describe the efforts to date of the Massachusetts Psychiatric Society in this area. Managed care is here to stay. The future climate of psychiatric practice and the care available to psychiatric patients are dependent on informed and organized activities by psychiatrists and their local and national representatives.

Enforcing Informed Consent Requirements: Form or Substance?

In his article Enforcing Patient Preferences: Linking Payment for Medical Care to Informed Consent, in this issue ofThe Journal, 1 Kapp argues that many medical interventions currently are being imposed on patients in the absence of voluntary, competent, and informed He proposes that utilization review organizations link financial reimbursement for medical services to requirement of valid patient (or surrogate) consent. 1 The proposal by Kapp is that individual and institutional health care providers will not be paid for a medical service unless a signed consent form covering that service is found in the patient's chart. There are difficulties in Kapp's formulation of the problem, and many more with his formulation of the solution. With regard to the problem, although empirical research is limited, there is indeed evidence of a gap between the rhetoric of informed consent and the frequency with which physicians involve patients in medical decisions

The Corporate Compromise: A Marxist View of Health Maintenance Organizations and Prospective Payment

Recent developments in health care are strikingly congruent with a Marxist paradigm. For many years small scale owner producers (physicians) dominated medicine, and the corporate class supported the expansion of services. As health care expanded, corporate involvement in the direct provision of services emerged. This involvement is reflected not only in the rise of for-profit providers, but also in the influence of hospital administrators, utilization review organizations, insurance bureaucrats, and other functionaries unfamiliar with the clinical encounter, but well versed on the bottom line. Corporate providers' quest for increasing revenues has brought them into conflict with corporate purchasers of care, whose employee benefit costs have skyrocketed. This intercorporate conflict powerfully shapes health policy and has caused the rapid proliferation of health maintenance organizations and other forms of prospective payment. Corporate purchasers of care favor the incentives under prospective payment for providers to curtail care and its costs. For corporate providers, prospective payment has allowed increased profits even in the face of constrained revenues, because reimbursement is disconnected from resource use. Unfortunately, this corporate compromise serves patients and physicians poorly. Alternative policy options that challenge corporate interests could save money while improving care.