Health plans are under the kind of financial pressure that does not resolve on its own. HealthScape Advisors’ 2026 financial performance report found that nearly three-quarters of health plans reported operating losses in 2025, and that medical cost, not administrative expense, is the primary driver. Premiums grew. Medical costs grew faster.
There are several cost drivers that need attention. One lever for cost management is utilization management, which can responsibly remove unnecessary cost: care in an inappropriate setting, treatment the evidence does not support, and determinations that do not hold up and return as appeals. Two shifts make that possible.
- The reviewer is qualified for the case. The recent AMA survey found that only 16 percent of physicians say the health plan representative in a peer-to-peer review is often or always appropriately qualified. A determination made by a clinician matched to the specialty and the clinical question is more accurate, more defensible, and less likely to be overturned, which is precisely the outcome now visible in public metrics. Work with a UM partner whose model is built with a broad network of actively practicing, same-specialty physician reviewers licensed in all 50 states, so the person reviewing the case actually practices in the field.
- Focus on where care is delivered, not just whether it is approved. Recent reporting on hospital market consolidation found the same procedure priced at more than double from one facility to another in the same region, driven by market power rather than any clinical difference. Approving a medically necessary service is only half the decision; the setting can change its cost by a wide margin. Review that surfaces appropriate, lower-cost sites of care captures spend that a simple approve-or-redirect decision never reaches.
What better UM looks like in practice
For plans trying to manage medical trend without adding review burden, four moves matter most.
- Concentrate review where cost and variability are highest. Pull low-value, low-yield requests off the prior authorization list and focus clinical attention on high-cost, high-variability services. This aligns with the federal reductions rather than fighting them.
- Modernize the workflow, keep the physician in the decision. Tech-enabled intake and routing shorten turnaround and help meet CMS-0057-F timeframes of 72 hours for expedited and seven calendar days for standard requests, while physician reviewers make every determination. Technology enables the process; clinicians make the call.
- Treat determination quality as the number that matters. Same-specialty, physician-led review produces more accurate, more defensible decisions, reducing the appeals and rework that erase any short-term savings, and standing up to public reporting.
- Use your own review data. Benchmarking and analytics across review activity surface the root causes of unnecessary prior authorization and spend, turning individual determinations into operational improvement.
Utilization management is no longer a private cost lever a plan can turn up quietly. It is a published, comparable measure of clinical judgment. The plans that lower cost from here will be the ones whose reviews are appropriate, defensible, and delivered by the right clinician, because that is now the same thing as the cost strategy that survives public scrutiny. That is the standard MRIoA was built to meet: clarity and confidence in every clinical decision.
The principles behind better utilization management extend across every part of a health plan’s book of business. Specialty pharmacy is one of the highest-stakes areas: as drug costs continue to climb, the quality of the clinical review behind each determination matters as much as the decision itself. Safeguarding Care by Rethinking Utilization Management for High-Cost Specialty Drugs examines what rigorous, independent specialty drug UM actually looks like in practice. And because the regulatory environment shapes what plans are required to do, not just what they choose to do, Compliance Is a Business Risk You Can’t Ignore outlines how state and federal PA reform is raising the stakes for every clinical operations team.
To see how physician-led review ensures members receive appropriate care, schedule a consultation with our clinical team at mrioa.com.
