A Statistical Control Model for Utilization Management Programs

A new approach is proposed for monitoring health-care costs to help in cost containment efforts. This informative essay is intended to provide information on and stimulate discussion of ways of improving the health-care management process. Data that are being collected by insurers and providers could be used to analyze and improve the health-care process. New statistical techniques, and better, more consistent input of data, will be critical to successful utilization management programs. Necessary conditions for the success of the new methods are (1) diagnosis protocols that are ‘‘true gold standards,’’ (2) a satisfactory disease classification system, (3) meaningful and consistently coded data, and (4) statistical methodology that takes advantage of as much of the available data as possible. The hospital admissions process is illustrated to show the incorporation of an inexpensive statistical control process for reducing the incidence of unnecessary hospitalizations.