What Is Utilization Review in Workers Compensation?

Utilization review in workers’ compensation is the process by which an outside medical expert reviews the medical provider’s diagnosis and medical treatment to determine if the proposed or completed medical treatment is medically necessary for an injured employee.  There are three primary types of utilization review.  Pre-certification review occurs before the medical procedure or treatment is provided.  A concurrent review occurs during the time the medical treatment or service is being provided, for example during a hospital stay.  A retrospective review occurs after a medical service has been provided.



Utilization Review Determines If Medical Procedure is Necessary


The utilization review will be completed by a highly experienced nurse who will thoroughly review the medical records to determine if a medical procedure is necessary for the injured employee.  The nurse will also verify there is a causal relationship between the medical procedure and the workers’ compensation injury.


Utilization review is not second guessing or just the opinion of a nurse.  The utilization review company should be certified by the Utilization Review Accreditation Commission (URAC) which establishes uniform standards throughout the medical field for utilization review.  An insurer or self-insured employer should not consider a utilization review company that does not have URAC certification.


The various states have all gotten involved in what is acceptable or not acceptable for utilization review.  The utilization review company should be willing to verify that it will comply with each state’s individual requirements.  If the utilization review company does not comply with the jurisdictional requirements of a state, the medical provider can contest the utilization review.  Lack of compliance with the jurisdictional requirements can result in the utilization review being thrown out.



Utilization Review is Not Black and White


While the states have jurisdictional guidelines, few utilization reviews are clear cut, black or white.  It takes an experienced nurse to review all the criteria for a medical service request and to verify the criteria for the medical service has been met.  The nurse will also review the jurisdictional guidelines to see if the medical information supports the requested treatment.  If the jurisdictional guidelines are silent on a particular medical treatment, the nurse will review standard treatment guidelines.  All utilization review decisions are based on the medical documentation provided by the employee’s medical provider.


If the utilization review nurse does not agree a medical service is needed, the nurse will escalate the review to a physician for review.  The peer review should be completed by the same type of medical provider who is treating the injured employee. For instance a utilization review of an employee with an injured knee should be completed by a physician who is a knee specialist.  (For this reason it is always important to select a utilization review company that is large enough to have a wide variety of specialists on staff)



Peer-to-Peer Discussion Will Follow Any Treatment Disagreement


The peer review physician will follow the jurisdictional guidelines and standard medical treatment guidelines to determine whether or not he/she agrees with the medical service under review.  If the utilization review physician disagrees with the medical procedure, the review physician will deny the request and provide a detailed explanation as to why the procedure is denied.  Also, if the review physician is in doubt, the physician will set up a peer-to-peer discussion to see if there is a rational reason for the medical procedure, before denying or approving a procedure.


Utilization review is not used for emergency medical services where a delay in medical treatment is life threatening. In a life-threatening emergency, the focus is on doing everything possible to save the life of the injured employee.


To achieve maximum savings from utilization review, many insurers and self-insured employers will select a utilization review company that can integrate other medical cost savings programs like medical triage, medical bill review, nurse case managers, senior nurse reviewers, physician review services, peer reviews and pharmacy reviews into a seamless package.  For assistance on identifying a utilization review company that can provide either utilization review, or complete medical cost management, please contact us.



Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com


©2013 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

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