Annotated Bibliography - Utilization Management

This special supplementary section of the CounsellingBooks.com bibliography provides an independently produced annotated bibliography on managed behavioural healthcare prepared for the US Substance Abuse and Mental Health Services Administration; please see the first page of the supplement for recommended citation information.

Table of Contents

  1. Introduction
  2. Benefit and System Design
  3. Capitation
  4. Community Mental Health Services
  5. Diagnosis-Related Groups (DRGs)
  6. Economics, Forecasting, and Pricing
  7. Employee Assistance Programs (EAPs)
  8. Health Maintenance Organizations (HMOs)
  9. Law and Ethics
  10. Provider Issues
  11. Public Sector
  12. Quality Assurance and Outcomes
  13. Special Populations
    1. Children
    2. Elderly
    3. Ethnic Groups
    4. Women
  14. Substance Abuse
  15. Training and Education
  16. Utilization Management
  17. Author Index
  18. Keyword Index

Utilization Management

387. Baker, F., & Vischi, T. (1989). Continuity of care and the control of costs: Can case management assure both? Journal of Public Health Policy, 10, 204-213.

Traditionally, case-managed services have focused on individual needs through providing com-prehensive, flexible, and continuous services to mentally ill persons. The more recent emphasis on managed care belies an increasing concern with cost control. This article explores the potential conflict between the goals of continuity of care and of cost control, and describes a number of steps to reduce the potentially negative effects of these competing policies.
Keywords: utilization management

388. Belcher, J. R. (1993). The trade-offs of developing a case management model for chronically mentally ill people. Health and Social Work, 18, 20-31.

This article describes the role of case management in caring for chronic mentally ill people. While case management appears to be an ideal method to improve the quality of care and con-trol mental health costs, the author cautions about the difficulty of accomplishing both goals simultaneously. The article reviews different case management and brokering models and argues that social work professionals need to play a key role in proposing and implementing case management models that match client needs with appropriate services and that accurately reflect the costs of providing these services.
Keywords: case management, models, serious mental illness, utilization management

389. Clark, R. E., & Fox, T. S. (1993). A framework for evaluating the economic impact of case management. Hospital and Community Psychiatry, 44, 469-73.

Confusion about the efficacy and cost-effectiveness of alternative models of case management for mental health care stems in part from poorly defined assumptions about outcomes and unclear theories of the effect of case management on costs. This article identifies and discusses some of the determinants of cost-effective case management such as characteristics of the case management model, characteristics of clients served, and the administrative and financial con-text in which a program is implemented. Several models of case management are described, focusing on the ways in which these models differ with regard to resource management. A crit-ical distinction between models with implications for both costs and outcome is the extent to which each is client-directed or case-manager-directed. The authors conclude that case manage-ment has the potential to reduce costs, and to improve the lives of people with mental illness, but that it is not likely to do so unless unambiguous goals are set and the mechanisms for achieving them are clearly defined.
Keywords: case management, models, utilization management

390. Frank, R. G., & Brookmeyer, R. (1995). Managed mental health care and patterns of inpatient utilization for treatment of affective disorders. Social Psychiatry and Psychiatric Epidemiology, 30(5), 220-223.

This analysis estimates the impact of managed care on the provision of hospital care for depression, using a database of individuals insured by large American corporations. The authors assessed the effects of managed care on the cost per episode and the likelihood of re-hospitalization. Results of the analysis suggest that the managed care strategies of utilization review and case management have clear short-run impacts. Pre-admission certification pro-grams also resulted in both long- and short-term savings through a reduction of both episode duration and re-hospitalization.
Keywords: costs, depression, utilization management

391. Gabbard, G. O., Takahashi, T., Davidson, J., Bauman-Bork, M., & Ensroth, K. (1991). A psychodynamic perspective on the clinical impact of insurance review. American Journal of Psychiatry, 148, 318-323.

This article explores the impact of managed care and utilization review on clinicians, their clients, and families. According to the authors, utilization review creates uncertainty about the length of stay for psychiatric inpatient care, and chaotic treatment planning. The authors argue that managed psychiatric care has led to adverse outcomes for many patients through prema-ture discharge and a reluctance to hospitalize. Five case studies are presented to illustrate the authors’ points about the negative impact of utilization review on inpatient psychiatric care. The authors conclude with a call for better outcome studies on the cost-effectiveness of extend-ed hospital treatment and for increased collaboration between payer and provider.
Keywords: utilization management

392. Glazer, W., & Morgenstern, H. (1993). The impact of utilization management on hospital length of stay and illness outcome. Administration and Policy in Mental Health, 21, 41-49.

This article presents an experimental model to determine the effect of utilization management on the cost and outcome of inpatient psychiatric treatment. Two hypotheses would be tested: that utilization management feedback results in a reduction in the average length of stay, and that utilization management does not adversely affect illness outcome after hospitalization. The design and methodological factors that must be considered to implement such a study are also discussed.
Keywords: utilization management

393. Goldstein, J. M., Bassuk, E. L., Holland, S. K., & Zimmer, D. (1988). Identifying catastrophic psychiatric cases: Targeting managed-care strategies. Medical Care, 26, 790-799.

Many utilization review programs have developed standardized criteria (generally diagnosis-based) to identify and monitor potentially catastrophic and high-cost cases. These criteria, however, do not consider several factors that might predict catastrophic illness, such as age, gender, and treatment setting and location. The study, based on claims data from more than 3,000 psychiatric inpatient admissions, demonstrates that these factors together and alone may contribute to long stays and high costs. High costs and long stays were more likely to be asso-ciated with adolescent admissions and admissions involving major affective, organic, and eat-ing disorders. Catastrophic admissions were also more likely to occur in free-standing psychi-atric hospitals. Long stays were more likely in the Northeast, and high-cost cases in the West. These findings suggest that case managers take patient and setting characteristicsÑnot just diagnosisÑinto account when determining which cases should receive special attention.
Keywords: utilization management

394. Goldstein, L. S. (1990). Linking utilization management with quality improvement. Psychiatric Clinics of North America, 13, 157-169.

This article compares and contrasts utilization management and quality improvement and describes how utilization management can lead to quality improvement. The goal of utiliza-tion management is efficiency. Preadmission authorization, admission review, case manage-ment, and drug use evaluation are examples of utilization management. The goal of quality improvement is to ensure that the structure and process of care is effective. Quality improve-ment activities include the development of normative and empirical criteria, and outcome studies. Despite their different goals, utilization management data, such as patterns of resource utilization, can be used to ensure quality. The article describes a drug utilization evaluation that identified potentially problematic prescribing practices at a psychiatric unit. The findings catalyzed efforts to educate psychiatrists to ensure quality.
Keyword: quality assurance, utilization management

395. Gotowka, T. D., & Smith, R. B. (1991). Focused psychiatric review: Impacts on expense and utilization. Benefits Quarterly, 7(4), 73-81.

This article reports the results of an evaluation to determine whether Focused Psychiatric Review (FPR), Aetna’s utilization review program, reduces the use and costs of psychiatric hospitalization. Hospital utilization was compared using claims data for approximately 16,000 beneficiaries who were subject to FPR, and 11,000 non-FPR controls. The study found that FPR resulted in lower admission rates and lengths of stay, and that initiating case management before admission led to shorter lengths of stay and lower hospital costs. The study also found that length of stay is affected by day of admission, because Tuesday through Friday admissions are often carried over an additional weekend. FPR has a greater impact on psychiatric disor-ders than on substance abuse disorders and on nonpsychoses than on psychoses. These reduc-Annotated 393. Goldstein, J. M., Bassuk, E. L., Holland, S. K., & Zimmer, D. (1988). Identifying catastrophic psychiatric cases: Targeting managed-care strategies. Medical Care, 26, 790-799. Many utilization review programs have developed standardized criteria (generally diagnosis-based) to identify and monitor potentially catastrophic and high-cost cases. These criteria, however, do not consider several factors that might predict catastrophic illness, such as age, gender, and treatment setting and location. The study, based on claims data from more than 3,000 psychiatric inpatient admissions, demonstrates that these factors together and alone may contribute to long stays and high costs. High costs and long stays were more likely to be asso-ciated with adolescent admissions and admissions involving major affective, organic, and eat-ing disorders. Catastrophic admissions were also more likely to occur in free-standing psychi-atric hospitals. Long stays were more likely in the Northeast, and high-cost cases in the West. These findings suggest that case managers take patient and setting characteristicsÑnot just diagnosisÑinto account when determining which cases should receive special attention.
Keywords: utilization management

396. Hennessy, K. D., & Green-Hennessy, S. (1997). An economic and clinical rationale for changing utilization review practices for outpatient psychotherapy. The Journal of Mental Health Administration, 24(3), 340-349.

Given the trend toward managed mental health organizations, there has been increased cost-consciousness in the financing and delivery of mental health and substance abuse services. In this paper, the authors examine how management strategies that result from these pressures have affected mental health and substance abuse services. After reviewing the evolution and application of managed care to behavioral health, they argue that pressures to reduce costs have led to the over-application of utilization review (UR) in a way that may be economically and clinically counterproductive. They provide several rationales for changing UR for outpa-tient psychotherapy as well as some alternatives to micromanaging outpatient psychotherapy benefits in an effort to promote a balance between economic and clinical goals.
Keywords: economics, psychotherapy, substance abuse, utilization management

397. Hersch, R. G. (1994). Mental health’s contribution to the financial performance of a utilization management program. Managed Care Quarterly, 2(2), 71-78.

This study uses data from a national utilization management program, covering approximate-ly 3.4 million individuals from 1989 through June 1993, to analyze the costs and benefits of mental health utilization review compared with medical, surgical, and maternity management. Analysis revealed that while the costs of performing mental health utilization management are significantly greater than for the medical areas, so are the returns on investment. Indeed, in 1993, the management of the mental health hospitalizations provided seven times as much in absolute dollar savings as a surgical case, and 20 times as much as the management of a maternity case. The article also discusses the implication of full mental health benefits for health care reform.
Keywords: costs, utilization management

398. Langman-Dorwart, N., Wahl, R., Singer, C. J., & Dorwart, R. A. (1992). Managed mental health: From cost containment to quality assurance. Administration and Policy in Mental Health, 19, 345-353.

This article describes the managed care approach of one national managed health care compa-ny over the past 5 years, with an emphasis on the integration of quality assurance into utiliza-tion review. Through a case-study approach of this company, the authors explore the ways in which an emphasis on quality may, in the long run, lead to increased cost-effectiveness and efficiency. The authors conclude that clinically oriented utilization review can control mental health costs while monitoring and improving quality of care. They anticipate future changes in mental health cost containment efforts such as increasing reliance on utilization and quality data, improved match between clients and approved clinicians based on acuity and appropri-ateness of service, and continued redirection of patients to outpatient settings.
Keywords: quality assurance, utilization management

399. Lewin, R., & Sharfstein, S. S. (1990). Managed care and the discharge dilemma. Psychiatry, 53, 116-121.

This article describes the ways in which efforts by "fourth party" case managers to contain costs may lead to premature hospital discharge for severely mentally ill patients. A case study of a borderline patient exemplifies the potentially deleterious effects of early discharge on patients such as the "sicker and quicker" phenomenon leading to repeated short-term hos-pitalizations, pressure to inappropriately use high doses of medicines or electroconvulsive therapy in order to produce a rapid clinical response, and compromise of treatment goals. The authors argue that there is an urgent need for outcome studies that justify the costly treatment in inpatient care for a subset of patients and that document the negative impacts of premature discharge. Further, they advocate increased reimbursement for community-based residential care for chronically mentally ill persons.
Keywords: serious mental illness, utilization management

400. Oehm, M. J. (1992). Information systems. In S. Feldman (Ed.), Managed mental health services (1st ed., pp. 143-164). Springfield, IL: Charles C. Thomas.

An efficient, reliable, and flexible computer information system can enhance the quality of utilization management. Despite its advantages, few utilization management companies have implemented such a system because they prefer "tangible" recordkeeping and fear high costs and frequent downtime. The author describes the key features of an information system and how it can address these concerns. The system should be fast and reliable and include data about patients, providers, benefits, and clinical criteria. Among other features, it should perform coding and "flag" certain cases, assign case numbers, and automatically transfer information to the claims system. Although the most effective systems are internally developed, the author concludes that packaged systems can be successfully adapted for use.
Keywords: information systems, utilization management

401. Panzarino, P. J., & Wetherbee, D. G. (1990). Advanced case management in mental health: Quality and efficiency combined. QRB Quality Review Bulletin, November, 386-390.

The case manager in a managed mental health care system can serve as the patient’s ombudsman to provide high quality care. Treatment effectiveness data, outcome studies, and utilization patterns, rather than simply availability and cost of treatment, guide case managers’ decision making. There are four steps to the decisionmaking process: preadmis-sion certification, triage, concurrent review, and individual case management or creative benefit reallocation. A case example illustrates how these steps can be employed to ensure a continuum of care in appropriate, cost-effective outpatient programs.
Keywords: case management, utilization management

402. Reinhardt, B., & Shepherd, G. L. (1994). Behavioral health case review: Utilization review or case management? One company’s view. In S. A. Shueman, W. G. Troy, & S. L. Mayhugh (Eds.), Managed behavioral health care: An industry perspective (pp. 76-91). Springfield, IL: Charles C. Thomas.

This chapter describes the process of managed behavioral health care as it is conducted by one case management company. The authors focus on (1) the role of the case manager; and (2) what the case management company can do legally and practically to affect patient treat-ment. They present some of their own experiences with case management.
Keywords: case management, utilization management

403. Sturm, R., McGlynn, E. A., Meredith, L. S., Wells, K. B., Manning, W. G., & Rogers, W. H. (1994). Switches between prepaid and fee-for-service health systems among depressed outpatients: Results for the medical outcomes study. Medical Care, 32, 917-929.

The authors found that the lowest rate of plan switching was among patients of mental health specialists in fee-for-service plans, compared to general medical patients in fee-for-service plans and both types of patients in prepaid plans. Additional findings of this longitudinal study are presented and discussed.
Keywords: capitation, utilization management

404. Tischler, G. L. (1990). Utilization management of mental health services by private third parties. American Journal of Psychiatry, 147, 967-973.

In utilization management a third partyÑrather than the physicianÑis the final arbiter of treatment. This article describes three utilization management approaches: preadmission certi-fication, concurrent review, and case management. Utilization management raises a number of issues, such as professional bias in treatment, what constitutes an effective community substitute for inpatient care, the role of utilization management in shifting costs from Federal to State agencies, the lack of privacy safeguards, quality control, and practitioner liability. The author concludes that there is a need for further study of the implications and efficacy of utilization management.
Keywords: utilization management

405. Tischler, G. L. (1990). Utilization management and the quality of care. Hospital and Community Psychiatry, 41, 1099-1102.

Utilization management has implications for the availability, appropriateness, and effectiveness of mental health care. This article discusses the history of utilization management in both the public and private sectors, and the development of peer review approaches to care decision making. The author identifies clinical and economic factors that influence care decisions, and suggests ways to determine whether systematic biases exist in reviewer decision making. He concludes that more research is needed on the impact of cost-containment initiatives on access and outcome.
Keywords: utilization management

406. Trabin, T. (1994). How will computerization revolutionize managed care? Managed Care Quarterly, 2(2), 22-24.

This brief article presents an imaginary scenario of how computerization will help clinicians and case managers access and communicate patient data for behavioral health services in the near future. The author uses this scenario to demonstrate how computerization of behavioral health information is revolutionizing the way payers, managed care companies, and providers use and exchange information. He describes some of the benefits of this advanced technology and obstacles to attaining these gains.
Keywords: information systems, utilization management

407. Wanerman, L. (1993). Managed mental health for children and adolescents. New Directions for Mental Health Services, 59, 13-26.

In this chapter, the author uses a series of cases to illustrate the ways in which managed care can provide comprehensive and cost-effective mental health and substance abuse treatment for children and adolescents. The author briefly describes the Focused Adolescent and Child Treatment team at U.S. Behavioral Health (USBH), a national managed care company. The team includes mental health professionals from a variety of disciplines who work with providers to coordinate care from intake to referral and continual case monitoring. The author argues that this approach can protect generally limited and restrictive mental health benefits so they are available when truly needed. USBH’s guidelines for level-of-care decisions in mental health for children and adolescents are included in an appendix.
Keywords: children, managed behavioral health care organizations, utilization management

408. Wickizer, T. M., & Lessler, D. (1998). Do treatment restrictions imposed by utilization management increase the likelihood of readmission for psychiatric patients? Medical Care, 36(6), 844-850.

This article describes a 5-year study on more than 2,000 privately insured psychiatric patients and uses logistical regression analysis to determine how utilization management programs affected restrictions on length of stay and the likelihood of readmission. The findings indicated that those patients whose length of stay was restricted by utilization management (UM) were more likely to be readmitted. The authors view readmissions as a sign of poor quality service and believe UM programs might best serve patient populations by improving clinical outcomes as well as containing costs.
Keywords: utilization management

409. Wickizer, T. M., & Lessler, D. (1998). Effects of utilization management on patterns of hospital care among privately insured adult patients. Medical Care, 36(11), 1545-1554.

Although utilization management (UM) is one of the primary tools of an HMO in cost con-tainment, there has been little research on the effects of this practice on patterns of care. In this study, researchers examined pre-admission review and concurrent (continued stay) review of 49,654 privately insured adult patients undergoing utilization review between January 1989 and December 1993. The focus of the study was to examine how often UM denied care at time of admission, to what extent UM restricted hospital length of stay, which diagnoses and procedures were most affected by UM, and whether UM became more restrictive with time. The study found that fewer than 1 percent of patients were denied care at time of admission. Restricting length of stay through concurrent review accounted for 83 percent of the total reduction in inpatient care. Utilization management was the most restrictive for mental health patients, who represented 5.7 percent of the study population but accounted for 54.7 percent of the total reduction in requested days.
Keywords: utilization management

410. Wickizer, T. M., Lessler, D., & Travis, K. M. (1996). Controlling inpatient psychiatric utilization through managed care. American Journal of Psychiatry 153(3), 339-345.

This article reports the results of a study of the effect of utilization management on psychi-atric hospital inpatient care. The authors analyzed data on utilization management review activities conducted by a single large commercial insurance carrier during 1989-1992. Measures included percentage of admission requests approved, number of days requested and approved, and number of additional treatment days granted. In addition, the authors exam-ined how the number of days approved by utilization management compared with lengths of stay of patients with similar diagnoses in the general population as reported by the National Hospital Discharge Survey. The authors discuss the limitations of the study, and stress the need for studies on the effects of managed care on patient outcomes and the quality of care.
Keywords: utilization management

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This page was last reviewed by Dr Greg Mulhauser, Thursday, 14 October 2021.