What is Utilization Management?

Utilization management (UM) is a process used by healthcare organizations, insurers, and managed care entities to ensure that healthcare services are appropriate, medically necessary, and delivered in the most efficient and cost-effective manner possible. Utilization management encompasses various strategies and activities aimed at optimizing the use of healthcare resources while maintaining quality of care.

Utilization Reviews (UR): are an integral component of utilization management.Utilization reviews involve the assessment of healthcare services provided to patients to determine medical necessity, appropriateness, and adherence to established clinical guidelines and policies.

  • Prospective utilization reviews typically occur during the preauthorization process, where healthcare providers or payers assess the necessity and appropriateness of proposed treatments, procedures, or hospital admissions.
  • Concurrent utilization reviews involve ongoing monitoring of patient care while treatment is underway to ensure that care remains appropriate and that resources are utilized efficiently.
  • Retrospective utilization reviews occur after services have been delivered and involve an assessment of the medical necessity and appropriateness of care based on documentation and clinical information.