Recorded presentation

Thomas M. Wickizer, PhD¹, Gary Franklin, MDMPH², Jeremy Gluck, PhD³, and Deborah Fulton-Kehoe, MPH³. (1) Department of Health Services, University of Washington, Box 357660, Seattle, WA 98195-7660, 206:616-2983, tomwick@u.washington.edu, (2) Washington State Department of Labor and Industries, POB 44600, Olympia, WA 98504, (3) Department of Environmental and Occupational Health Sciences, University of Washington, Box 357660, Seattle, WA 98195

Utilization management (UM) is widely used by health insurance carriers and purchasers to identify inappropriate or unnecessary medical care. UM usually requires requests for care to be reviewed on a prospective basis for all procedures or hospitalizations for which approval for treatment is required as a condition of health care insurance coverage. UM has been widely criticized for increasing administrative costs and for contributing to the paperwork burden of the health care system. We analyzed data on UM requests to explore how UM procedures could be made more efficient and less administratively burdensome by using a targeted approach to perform reviews. The Washington State Department of Labor and Industries (L&I), which administers the state workers’ compensation program, developed treatment guidelines in collaboration with the Washington State Medical Association, and then used these guidelines to formulate review criteria for its UM program. From 1993 through 1998, 100,005 reviews were performed, half of which (50,275) were performed under the guidelines. We used multivariate logistical regression to examine the factors associated with denial, based on the 50,275 reviews that could potentially serve as targeting criteria for UM, controlling for age and sex of subject. Three factors were examined: type of guideline, volume of requests per physician, and physician denial rate during the initial two years of observation (1993 and 1994). The guidelines accounting for most of the 50,275 reviews were lumbar MRI (38.2%) and carpal tunnel surgery (22.9%). The overall denial rate was 8.1%, but the denial rate varied significantly (p < .001) by guideline. The guidelines with the highest denial rates were lumbar fusion (19.5%) and thoracic outlet syndrome surgery (18.6%). Volume of requests had little overall meaningful effect on the likelihood of a given request being denied. In contrast, baseline physician denial rate and type of guideline had significant effects (p < .01). The odds ratios associated with the guidelines and the denial rate measure varied by almost six fold, suggesting a targeted approach to UM may have significant utility. For example, had UM reviewed only carpal tunnel surgery requests made by physicians with baseline denial rates in the upper two quintiles of the denial rate distribution, 742 (70.7%) of the 1,049 total denials would have been captured but only 5,457 physicians requests, instead of 11,493, would need to have been reviewed. The “targeting effect” was even more striking for lumbar MRI. By using a targeted approach, UM programs could substantially improve the efficiency of the review process while reducing administrative burden.

Learning Objectives: At the conclusion of the session, the participant (learner) in this session will be able to

• Describe the procedures used to identify inappropriate care through utilization management,
• Discuss how health care purchasers could improve the efficiency of utilization management by using targeting strategies to identify inappropriate care, and
• Plan analyses t determine whether targeting should be used for a given insured population to identify inappropriate care.

Presenting author's disclosure statement:
I do not have any significant financial interest/arrangement or affiliation with any organization/institution whose products or services are being discussed in this session.

Recorded presentation