Managed care is utilization review.

The role of utilization review (UR) as a form of managed care is described. As technology has advanced, the use of diagnostic and therapeutic services has increased and care delivery has shifted to outpatient settings, but the increase in healthcare costs has not slowed. The shift to delivery of medical care outside the hospital setting has increased the need for effective UR in both inpatient and outpatient settings. UR is performed not only by private UR organizations and through external review programs of insurance carriers but also through care-providers' internal programs. UR has been driven by increased medical costs and by redesign of insurance benefit plans to include financial incentives and penalties and copayments. UR has attempted to control the use of hospital services through preadmission certification and concurrent review, requirements for second surgical opinions, and medical case management, which is the identification before or during hospitalization of patients who could safely receive treatment outside the hospital. In-patient mental health and substance-abuse programs have been the subject of intensive review because of high expenditures for such services. Practice indicators are being developed that will be used for prospective determination of treatment plans. As UR techniques improve, management of care in all organized health-care settings will intensify.