Rethinking utilization management: healthcare's $15 billion opportunity to cut administrative waste

Utilization management (UM) is a painstakingly manual process that adds administrative burden, increases healthcare waste and complicates payer-provider dynamics — yet does not necessarily improve patient care.

During a November Becker's Hospital Review webinar sponsored by XSOLIS, Kelly Layton, RN, senior director of clinical engagement consulting at XSOLIS, and Cindy Neumany, vice president of clinical operations for population health at Hackensack (N.J.) Meridian Health, discussed how artificial intelligence-driven models can power a new approach to UM that enables organizations to do more, and do it better, with existing resources.

Four key takeaways were:

  1. Current UM review processes are inefficient and associated with high administrative waste. Out of the $4 trillion the U.S. spends annually on healthcare delivery, one-quarter is spent on non-clinical administrative functions, including approximately $15 billion spent on medical necessity reviews, required documentation and payer-provider communications.

    Manual UM processes account for a significant portion of this wasteful spending because they lead to subjective reviews that are not prioritized by risk and potential for revenue loss, causing cases to slip through the cracks. Similarly, criteria-based solutions relegate UM nurses to checking a box to determine medical necessity, offering little insight into which cases warrant a second level review."It could be said that staff know the criteria and the boxes to check, but not their patients," Ms. Layton said.

  2. A more enlightened approach to UM harnesses the power ofreal-time clinical data analyzed for likeliest outcome. XSOLIS helps organizations modernize their UM processes by leveraging CORTEX, an artificial intelligence-powered solution that interfaces with a hospital's EMR and offers immediate level-of-care insights based on a patient's diagnosis-related group, severity of illness and other factors. These insights eliminate the need for traditional screening tools used for medical necessity recommendations and equip staff with priority-based workflows. "Our goal is to ensure the patient is placed in the appropriate status quickly and accurately while minimizing appeals and denials," Ms. Layton said.

  3. XSOLIS is winning over providers by enabling a clear line of sight into key UM metrics. Before Hackensack Meridian Health implemented XSOLIS's technology, leaders at New Jersey's most comprehensive healthcare network were struggling to get a good understanding of workflow prioritization, patient health status conflicts, denial metrics, payer behavior, physician advisor performance and global reporting capabilities, among other criteria. "Those are the things we felt were really important and the big reasons why we transitioned to XSOLIS," Ms. Neumany said.

  4. Payer-provider relationship also benefit from a streamlined UM process. An optimized, artificial intelligence-driven approach to UM resolves important challenges that stand in the way of a smooth payer-provider relationship: overwhelming fax- and telephone-based communications, misalignment of available documentation, backlogs created by manual processes and lag times around patient transitions, discharge notifications and transfer referrals.

    "Imagine a day where we're aligning payers and providers together to reduce administrative burden, reduce clinical overhead for cases reviewed and have more first-touch determinations. That means when the clinical [data] is looked at together through our consolidated dashboard, the payers and providers are coming to decisions quicker [thanks to] fewer requests for additional clinical data, fewer requests for pended reviews and real time updates," Ms. Layton concluded, laying out the vision XSOLIS's UM technology embodies.

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