Process and procedures implemented to administer the use of health care services in the hospital by evaluating quality of care and establishing appropriateness and medical necessity for services. It ensures maximum medical care resource use and helps reduce health care spending. Examples of UM are preadmission certifications, admission reviews, concurrent reviews, focused reviews, individual case management, discharge planning, retrospective reviews, provider profiling, and second surgical opinions.
Insurance Encyclopedia
Utilization or management control
See: utilization review (UR) and medical review (MR) .
Utilization review (Health Insurance)
A process used to control medical costs, wherein the participating employer and the insurance company monitor the quality, need, and suitability of health care services offered by a plan.
utilization review (UR)
Process, based on established criteria, of evaluating and controlling the medical necessity for services and providers’ use of medical care resources. Reviews are carried out by allied health personnel at predetermined times during the hospital stay to assess the need for the full facilities of an acute care hospital. In managed care systems such as an HMO, reviews are done to establish medical necessity and appropriateness or efficiency of health care services, thus curbing costs. UR is also monitored by both insurers and employers. Also called medical review, continued stay review, utilization , and management control .
Utilization Review Accreditation Commission (URAC)
Independent, nonprofit organization established in 1990 that promotes health care quality through its accreditation and certification programs. URAC offers a wide range of quality programs and services that keep pace with the rapid changes in the health care system and provide a symbol of excellence for organizations to validate their commitment to quality and accountability.
Utilization review nurse
Registered nurse who evaluates medical cases for appropriateness of care and length of service and plans services required after discharge from a health facility.
utilization review organization (URO)
1. In the insurance industry, state association that conducts utilization reviews for property and casualty insurers. 2. In health care, entity that has established one or more utilization review programs, which evaluates the medical necessity, appropriateness, and efficiency of the use of health care services, procedures, and facilities.
utilization summary data
Information that is aggregated by the capitated managed care entity (e.g., the number of primary care visits provided by the plan during the calendar year).
Utmost good faith
(uberrima fides, or uberrimae fidei, of the utmost good faith) a duty laid on the parties to an insurance contract, especially the proposer, of greater force than ordinary good faith, requiring full disclosure of all facts which are or might be material to the contract; this duty subsists throughout negotiations over the terms of the contract and until the contract has been concluded, and may be maintained during the period of the contract if the policy so provides.
Utmost Good Faith (Uberrimae fidei)
Contracts of insurance and reinsurance are contracts of utmost good faith. In the event that either party fails to observe utmost good faith towards the other in regard to the negotiation of cover then the other party may avoid the contract. The duty of utmost good faith requires each party to inform the other all material facts during the negotiation of the placement, renewal or alteration of cover. An insured has a separate duty of good faith when making a claim under an insurance policy.
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A basic principle of insurance. Mutual trust in negotiating an insurance contract. The insured and the broker must disclose and truly represent every material circumstance to the underwriter before acceptance of the risk. A breach of good faith entitles the underwriter to avoid the contract.
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Firm adherence to promises made to another, including disclosure of all relevant facts, and complete trust in the fidelity of the other. Black’s Law Dictionary states: “The most abundant good faith, absolute and perfect candor, openness and honesty; the absence of any concealment or deception, however, slight.”
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An obligation of the insured to disclose material facts, i.e. facts that would influence the insurer before accepting the contract. The insurer must reciprocate but in practice the duty weighs more heavily on the insured. A breach by the insured makes the contract voidable ab inito at the insurer’s option. Breaches may be through concealment; non-disclosure; fraudulent misrepresentation; innocent misrepresentation. The duty is pre-contractual but revives at renewal and to certain midterm alterations affecting the risk. See CONTINUING DUTY OF UTMOST GOOD FAITH.
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Legally, the parties to an insurance contract are assumed to have entered the contract in the “utmost good faith,” which means they have not misrepresented any facts and intend to abide by the terms of the contract.
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A legal doctrine in which the highest standard of honesty is imposed upon the parties to an insurance contract.