Understanding the Role of Healthcare Utilization Management Organizations

You may not be familiar with the term healthcare utilization management but chances are, it plays an important role in decisions about your healthcare.

According to the NCI, healthcare utilization management is “a set of techniques used by or on behalf of purchasers of health care benefits to manage health care costs by influencing patient care decision-making through case-by-case assessments of the appropriateness of care prior to its provision.”¹

Explaining healthcare utilization management

What does this mean in the real world?

Here’s an example — when your oncologist requests that you have a scan, your insurance company needs to decide before the scan occurs whether or not to cover the cost. This process of “advance approval” is called prior authorization (also sometimes known as precertification or prior approval).²

Many insurance companies do not handle this approval process themselves, but instead, outsource the work to a healthcare utilization management company. This company then looks at evidence-based guidelines and makes the decisions about approvals and denials. Ultimately, clinicians employed by the healthcare utilization management organization determine whether they consider the scan your oncologist requested to be medically necessary or not, leading to a coverage decision. These physicians know very little about your history or specific situation.

My recent interaction with these companies

Normally the prior authorization process is seamless, which is why you might never know that a healthcare utilization management company is involved. Until very recently, I was not familiar with these companies either and thought that approvals and denials were determined solely by my insurance company.

I only learned about the existence and role of healthcare utilization management companies this past week when I received a message from a company “working on the behalf of my insurance company” that told me that my upcoming scans were “partially denied.”

This message came at a particularly stressful time for me. Our family was in the middle of moving out of the house where we have lived for the past 18 years. Since I was dealing with movers at the house and coordinating with our new condominium building regarding elevator use, I missed the live call and only heard the message later when checking my voicemail. There was no additional information left about which scans were denied (I had a brain MRI and CT scans of my chest and neck scheduled), reasons for the denial, or phone numbers to call to get additional information.

Back-and-forth with my insurance provider

So, after spending a significant amount of time on the telephone with my insurance company while the movers were loading our furniture into a truck, I learned about the existence of healthcare utilization management companies and that the message I received was left by the one that works with my insurance company! I also found out that while the brain MRI I have every six months was approved, my quarterly chest and neck CT scans were denied. Obviously, this was a mistake since I have lung cancer!

After many discussions with people at the insurance company and further conversations with my oncologist’s office, I uncovered that the reason for the partial denial was because my results had not been submitted correctly from my previous scans in April, so a new set of scans wasn’t deemed “medically necessary.” Luckily, my oncologist’s office was able to request a “peer-to-peer” discussion with a clinician at the healthcare utilization management company and once this technicality was resolved, my scans were approved and were able to take place on time.

Next time you receive an insurance denial

Why am I sharing this story? Well, in addition to venting over a time-consuming and frustrating experience, I want to shed as much light on the insurance approval process as possible so that others can understand better how their healthcare decisions are being made.

The healthcare utilization management companies hired by your insurance companies are following strict written guidelines for approvals and denials, not common sense. As a result, I believe that the absolute best thing to do if you find out a procedure, test, or medication has been denied is to contact your oncologist’s office. Although I offered to send results from my April scans to prove that they took place, a resolution was not possible until the “peer-to-peer discussion” took place.

If you receive a denial for anything your oncologist requests, my recommendation is to refrain from panicking, try to get as many details as you can regarding the reason why, and ask your oncologist to go to bat for you!

Editor’s Note: We are extremely saddened to say that on June 23, 2024, Ivy Elkins passed away. Ivy’s advocacy efforts and writing continue to reach many. She will be deeply missed.