Tom Kerr (TK): Auto casualty payers face many challenges in controlling medical spend while balancing compliance, appeal risk and operational efficiency. In today’s Enlyte Envision podcast, experts Roland Kratzer and Alex Rose discuss how payers can uncover hidden savings, improve utilization review performance and use data-driven strategies to turn retrospective review into a long-term competitive advantage.
Thank you both for joining us. Retrospective review is common across auto-utilization review programs, but performance can vary significantly. How can payers determine whether their review strategy is targeting the right opportunities? And Roland, let's start with you on this one.
Roland Kratzer: Thanks. I think there are many ways that payers can determine whether their review strategy is targeting the right claim, and one is looking at a simple cost-benefit analysis.
You can calculate out the savings per case that's reviewed versus the cost of the review process and determine your ROI. And, obviously, looking at the highest ROI would tell whether you've got a great program in place, and you can benchmark those against industry standards.
Another way is to look at the timeliness. Each program has jurisdictional time frames required and your program has to comply with those. So, you want to make sure that you are checking all the boxes, getting reviews completed on time and not unnecessarily having reviews get automatically approved because the utilization review organization didn't get their job done on time.
Another way to look at things is to look at your denial rate for your reviews versus your appeal rate. Obviously, the best outcome would be to have a reasonable denial rate and a very low appeal rate. If you are having high denials but also high appeals, then your program may be just too aggressive and not really match the demands of the jurisdiction. So, you want to make sure that your denials are reasonable but that your appeals are low so that you're making great decisions.
TK: OK, and Alex, can you tell us about the data aspect?
Alex Rose: Yeah, from a data perspective, Roland mentioned that there's a lot of metrics that we can calculate to get to that ROI. And I think our Enlyte data enables us to really calculate those accurately, given the amount of bills we have, and then just be able to create a level of certainty around that analysis as well.
Whether it be type of bill, PPO network, and how different segments of the population interact and give us confidence in that overall forecast that, even though there is high volatility within results, the overall picture will come out optimal.
TK: Roland, across auto casualty programs, what are the biggest challenges payers face when trying to identify where medical spend control opportunities still exist within an established utilization review program?
Kratzer: TK, the payers face a number of challenges when trying to identify medical spend control opportunities. The most basic one is interconnectivity. So simply having the data available to be able to evaluate claims and identify those that should go through utilization review is the most important thing.
It's a really unfortunate situation if you have to rekey in information simply to complete UR. We think that the best way to do it is to have a free flow of data going from bill review to utilization review where the decisions get made and then having that decision information flow completely back to bill review so those bills and any future bills can reflect clinical judgment.
Another challenge is honestly complacency with a mature program. We've seen in Michigan, where utilization review on auto claims has been taking place for the past six years, clients may think that their programs are just as good as it gets, that they're complying with regulations, but they can't really expect a lot out of that.
And we challenge that thinking because we think that a lot can be accomplished. We’ve had the data to prove that if the right bills are triggered for utilization review, they show that those bills are out of compliance with the medical guidelines and that they should be denied and the carriers should get savings on it.
And those results have surprised a number of carriers. It's shown them that there's a really great opportunity to target bills and, for even a mature program like Michigan Auto-UR, to achieve growing results.
TK: And since you brought Michigan up, let's talk about the reform that started there six years ago. I understand that you recently conducted a case study that shows there's still significant untapped opportunity, despite the progress that's been made. Can you talk about those results?
Kratzer: Yeah, absolutely. A number of carriers, when they've started their program, wanted to make sure that they were in compliance with Michigan's jurisdictional requirements. They implemented a utilization review program, but they really triggered the minimum number of bills possible, and that was done out of a concern for appeals and litigation.
The concern with a new process, as it was in 2019 and 2020, was bills not being paid because they were not in compliance with the guidelines and would be appealed to the state and through the courts.
And what we found is actually that mostly is not happening. That there's a really low appeal rate and a really low overturn rate from the courts, and that the decisions that we're making as utilization review organization are supported by the state of Michigan and supported by the courts.
And we've been able to provide great data for our clients to show them the more bills they trigger to us, the more savings that we can produce for them. We've shown that the faster that bills can come to us, ideally starting within 90 days of the date of the accident, it can really trigger some great savings because, at that point, bills are often no longer in compliance with the guidelines.
And so, for one client in particular, we were able to increase the reductions to the savings that they were paying by more than 12 times. That was a real eye-opener to this client, and we think there are a lot of carriers out there that could take a fresh look at their claims and that we could really drive some great savings for them.
TK: Alex, I'm going to go back to you on the next question here. Your work focuses on turning data into action. What does a broader benchmark-driven view reveal about your performance that a single program might miss?
Rose: Thanks, TK. I believe, as you mentioned before, the performance can vary significantly. So, I think taking that broader view allows us to really understand the entire picture and hone in on where the opportunities are and not analyze the data with blinders, only looking at some particular data points.
I like to think of it as creating a mosaic, because not all data points might say the same things, but when you bring them all together, that clear picture allows you to understand where the gaps and opportunities are.
TK: Roland, what does it take to operationalize retrospective review in a way that is consistent, defensible and aligned with a payer's dispute risk tolerance?
Kratzer: TK, there are a number of different elements to an effective program for retrospective review to make sure that you get the best results that are aligned with the payer's priorities. Really, it comes down to triggering the right bills at the right time and putting them through the right process.
We see that having bills triggered to utilization review sooner rather than later can increase the impact. Also, making sure those bills are considered versus the appropriate guidelines, such as ACOM or ODG, is really important.
Another is making sure that your reviewers have the licensure and the expertise that you need to get consistent results. We both have very experienced people on our team and a standardized training program that ensures that we have really effective medical decisions being made with each review.
Another thing that we do is have a really great QA program at the end of the process to ensure that the right decisions have been made. All the i's are dotted, the t's are crossed, and that will be in complete compliance with the jurisdictional requirements.
We also have a fantastic regulatory team that consistently monitors UR regulations and compliance requirements. I really can't understate the importance of having an automated workflow that keeps you in compliance with the timing and procedural rules.
And we have a great program in ReviewStat that makes sure we're able to document and have an audit trail in place if we need any records or documentation on any communications that have taken place should there be an audit or a dispute resolution required later.
TK: And I'm going to throw this next question out to both of you. What separates programs that see one-time gains from those that turn retrospective UR into a continuous performance advantage?
Kratzer: I think that the most important thing for having consistent advantages is a growth and development mindset on your team. We are consistently looking for ways to improve. We may have a great program today, and we do, but we intend to have a better program tomorrow and next year and the year after.
We're consistently looking to push the boundaries of what a great UR program can do, and by investing in our systems and our people, we're able to produce better and better results and honestly make our clients happier and happier.
Rose: And, from a data perspective, laws are always changing. Performance is always changing. So, we like to keep our models in a place where they’re always looking at live data and always taking that into account to enable people like Roland to always be optimizing in the future.
TK: OK, gentlemen, before we go, is there anything else that you wanted to cover or mention that we didn't address in today's podcast?
Rose: I think one thing is with the data mosaic that we have that comes from being able to participate in the lifecycle of a bill and a claim, it puts us in a unique position that others cannot compete with the data sets that we have.
Kratzer: I agree with Alex. I think the fact that we're able to track a bill through bill review to utilization review back into bill review, back to the client's claim system, gives us a unique advantage and really be able to help the carriers in a way that other organizations aren't able to.