What Utilization Review Is and How It Works

Utilization review (UR) is a process used in healthcare to make sure services are medically necessary, delivered in the right setting, and used efficiently under value-based care. It’s commonly performed by nurses, often in coordination with health plans, and occurs during care (concurrent review), after care ends (retrospective), or before treatment through prior authorization. UR is carried out by insurers, hospitals, home health companies and other providers. Hospitals generally must have an effective UR program to participate in Medicare and Medicaid. The review process can influence coverage decisions, such as inpatient versus observation status, and may involve discharge planning or case management.