Utilization Reviews Simplified.

Role of Clinical Documentation Improvement in Utilization Management

Clinical documentation improvement (CDI) is the process of enhancing medical documentation to maximize claims revenue and improve the quality of care. Payers rely on clinical documentation and accurate coding to justify reimbursement. Failure to document relevant clinical conditions leads to decreased reimbursement. Current trends have been placing a greater value on the severity of illness. Accurate documentation and capturing of HCC codes, increase the severity of illness indicators. In light of financial and patient care advancements, more hospital leaders are putting clinical documentation higher on their priority lists. The Black Book survey revealed that about three-quarters of hospitals put CDI on their budget agendas. Healthcare organizations should consider the following steps to establish a sustainable CDI program. Hospitals should start by conducting a gap analysis to identify documentation issues. Understanding where documentation challenges occur should help leaders to focus their programs on areas where revenue leakage is most prevalent. Second, healthcare organizations are going to need a multi-disciplinary team to lead the CDI initiative. In addition, the team should include stakeholders from across the health information management, utilization review, revenue cycle, and clinical departments. The number of large and community hospitals using outsourcing solutions almost doubled since ICD-10 came into effect in 2015. Physician Advisors are clinically experienced professionals that act as a bridge between providers and other staff to support CDI, utilization review, and claim denials management.

Impact of COVID-19 on Utilization Management

Acute Care Hospitals in the United States total over 139 million emergency department (ED) visits every year. Some studies show that up to 37% of those are non-urgent. For many individuals, such as safety-net populations, the ED serves as the front door to the nation’s complex healthcare system. With ED physicians serving as the primary decision-makers for over half of all hospital admissions—addressing patterns of high ED utilization is an important step when it comes to preventing unnecessary hospital admissions and readmissions. Annually, the US spends $41.3 billion on readmissions alone, yet one study of readmitted patients suggests that around one quarter are potentially avoidable. For payers, effectively identifying members with patterns of high utilization and working to redirect that care to lower-acuity care settings not only saves on care costs but often leads to better clinical outcomes as well. To help improve outcomes, hospitals have turned to implement concurrent utilization review management programs in Emergency Rooms. The use of emergency department Utilization Review programs has had a positive impact on the utilization hospitals were seeing. These programs have led to decreased observation rates and readmissions, saving on care costs and improving member outcomes in the process.

Outsourcing Utilization Review?

Many hospitals continue to run their Utilization management programs in-house using services provided by hospital staff who are not trained in Utilization Management. However, more and more hospitals are learning the advantages of outsourcing utilization review management. Following the revenue losses, the increased demands, and the staff shortages after the COVID-19 pandemic, more and more hospitals have started outsourcing utilization management.   

Hospitals benefit from outsourcing utilization review in several ways, as it can:

• Free up in-house physician advisors and chief medical officers to concentrate on other strategic work like policy development, improvement initiatives, personnel management, dealing with complex claims and appeals, and more.
• Ease the burden of dealing with fluctuating claims that occur with seasonal lulls, physician vacations, and epidemics (or pandemics, for that matter).
• Provide additional resources such as Peer-to-Peer reviews, payer insights and internal audits.
• Enable faster turnaround times, often a two-hour window.
• Streamline the review process.
• Lower cost in terms of staffing.
• Shorten the revenue cycle as more denials can be immediately reversed without long appeals.
• Cover reviews 24 hours a day, 7 days a week, 365 days a year.

What cannot be overlooked as a major benefit for outsourcing UR is that the physician advisors providing the service, who have knowledge of all current CMS guidelines and specific experience in reimbursement policies, can relieve the burden on clinical staff. They can perform UR duties in a cost-efficient, timely manner and ensure the proper level of utilization services. This allows treating physicians to focus more on patient care. While utilization management is often associated primarily with cost containment — and that is undeniably a major goal – improving care is also a high UM priority. Both the goals of cost containment and improved care are met when hospitals can reduce claim denials through effective utilization review.