Health reform drives application of independent reviewers

June 1, 2011

As the total ranks of the insured grow by upwards of 35 million people in the coming years, plans will face the burden of vastly increased administrative tasks.

AS THE TOTAL RANKS of the insured grow by upwards of 35 million people in the coming years, plans will face the burden of vastly increased administrative tasks. In seeking new efficiencies, plans will look for faster turnaround times on everything from claims to independent medical reviews.

While most health plan executives have a high-level knowledge of independent review organizations (IROs), because such services are embedded into the clinical operations of healthcare, their influence might not be addressed strategically. Fully leveraging external IROs is important given the extent of the contribution they can make to plans' efforts to improve efficiency, enhance revenue and minimize legal processes associated with appeals and claims denials.

The new MLR requirements are already reflected in most organizations' operational plans, and payer organizations have already begun looking for ways to trim costs and outsource non-essential business processes. They also have already started changing their use of IROs as a result of the initial reform regulations pertaining to internal and external appeals. Partnering with an independent review organization has become not only typical, but a best practice.

SPECIALIZED REVIEW DECISIONS

IROs can contract with hundreds of specialists, organize them into an optimized workflow and tightly integrate them into a health plan's clinical operations. In contrast, a plan might employ generalists for internal review and might have only a small number of specialists on staff.

For example, a health plan staff physician might be called upon to review a specialty procedure, such as varicose vein removal. By contrast, an IRO should be able to provide a vascular surgeon with appropriate clinical experience to make a fully informed decision. Some cases on the surface might not appear to be especially complex, but a specialist would be able to determine the appropriate level of evaluation required.

Similarly, an IRO's specialists with extensive oncology experience, for example, could make a more appropriate decision on cancer cases with comorbid conditions than, say, a medical director with internal medicine credentials only.

IROs make evidence-based clinical determinations based on the latest care standards as well as a health plan's clinical criteria. For example, today's IROs follow the published guidelines prepared by medical societies.

And while IROs integrate their services into health plan workflow, they still operate independently, which means they provide conflict-free decision making, thus upholding the integrity of the benefit decision making process. This is particularly important given the reform law regulations that stipulate that all claims and appeals must be decided on in a manner that ensures the independence and impartiality of the person making the benefits determination.

An added advantage of an extensive specialist panel is that an IRO should be able to provide reviews with short turnaround times and low unit costs. Internal clinical staff members often have less time to complete reviews. Because of economies of scale, IROs can often complete reviews within 24 hours.

If an IRO has invested in Web-based technology workflow portals, it can provide online collaboration between all constituents involved in any case. This ensures the IRO's review determinations come back into the plan's systems quickly with less manual work, enabling plans to close their decision-making loops faster. It also allows health plans to reduce overall costs by engaging with an IRO only when its services are required. For example, a plan will incur variable costs when using IRO services, which are lower than the traditional fixed costs of keeping a full-time medical director on staff for review determinations.

Further, with increasing IT security requirements as a result of the HITECH Act, demands are being placed on plans to greatly enhance their IT security postures. Healthcare executives must ensure that their IRO partners are following the same requirements and are making investments to upgrade the security of their technology platforms to meet emerging healthcare-related IT security certifications.

Andrew G. Rowe is CEO of AllMed Health Management, Inc., a national Independent Review Organization founded in 1995.