Why Now is the Time to Reclaim Utilization Management & How to Do It

Let’s be honest: if you work in utilization management (UM), you’ve probably seen it all. For years, delegating UM to vendors was the go-to move; helping health plans scale, meet regulatory deadlines, and handle growing volumes. And for many years it worked. But lately, the landscape is shifting.

Health plans across the country are rethinking how they manage core UM functions. Instead of a one-size-fits-all approach to prior authorization determination, UM leaders are strategically moving certain high-impact UM review processes back in-house, while still partnering with vendors for specialized or complex cases. Why? Because full delegation no longer keeps up with today’s realities.

Regulators want more transparency. Members demand faster decisions. Providers are tired of jumping through hoops. Internal care management teams are under pressure to deliver better outcomes, faster. And as provider trust erodes, health plans are realizing that outsourcing doesn’t just hand off work; it hands off control.

In this blog, we outline five essential steps that UM leaders can take, according to Availity’s® subject matter experts, to help reclaim and modernize UM, striking the right balance between full insourcing and full delegation.

1. Start with a Clear Vision and Intent

Before making any changes, pause and ask: Why are we reclaiming UM? Is your primary goal to improve member experience, rebuild provider trust, meet compliance requirements, or control costs? Getting clear on your “why” ensures your strategy aligns with your organization’s broader mission, and helps you communicate the purpose to every stakeholder, from executives to frontline staff.

“Deciding to bring core UM functions back in-house shouldn’t just be about cutting costs or increasing denial rates. Instead, it should be about delivering better care, greater transparency, and a UM program that truly reflects your values. When your vision is clear, every decision from technology investments to staffing models will support your long-term goals,” says Heidi Nielsen, Senior Director of Intelligent Utilization Management at Availity.

2. Build Strong Vendor Partnerships Where Needed

As health plans move core UM functions in-house, it’s important to recognize that not every aspect of UM should be insourced. For highly specialized areas like genetics, oncology, or rapidly evolving therapies, expert vendors still play a crucial role. These partners bring clinical expertise and up-to-date knowledge that may be difficult or costly to maintain internally.

“Delegation continues to make sense for complex specialties. The key is to be strategic: leverage vendors where their expertise adds the most value but retain oversight and ensure their processes align with your health plan’s policies and standards. This means regularly reviewing vendor performance, integrating their workflows with your own, and maintaining clear communication channels,” says Matt Cunningham, Executive Vice President of Product at Availity.

By building strong, collaborative relationships with specialized vendors, health plans can ensure high-quality, evidence-based decisions for complex cases, while keeping control over the broader UM strategy and member experience.

3. Leverage Data and Interoperability

Modern UM isn’t just about moving prior auth cases faster, it’s about making smarter, more informed decisions. Integrating your UM platform with electronic medical records (EMRs) and other data sources enables real-time decision-making and dramatically reduces manual data entry. This means less time spent chasing paperwork and more time focusing on clinical appropriateness.

“When systems “talk” to each other, UM teams can access the right clinical data at the right moment, leading to faster, more accurate authorizations. Data analytics also play a crucial role: by analyzing utilization trends and provider performance, health plans can identify opportunities for automation, spot bottlenecks, and continuously improve their processes,” says Vishal Shah, Director of Utilization Management Authorization Sales.

3. Automate Where Appropriate, But Keep Humans in the Loop

Automation and AI are transforming UM, but the smartest health plans know it’s not about replacing people. It’s about empowering them. Health plans should use AI and automation to handle routine, high-volume cases (“easy yeses”), freeing up UM nurses and clinicians to focus on complex, nuanced decisions that require human judgment.

As Robert Laumeyer, Chief Technology Officer at Availity, puts it: “Intelligent automation and AI are integral tools for success when dealing with timely and costly workflows like prior authorizations. However, they must always be accompanied by human influence. When health plans invest in AI, it’s critical that the technology be transparent, traceable, and grounded in responsible AI principles. Equally important, systems must enable human review, feedback, and continuous improvement, so automation functions as a true partner, not a black box.”

5. Invest in Change Management and Staff Support

When health plans decide to bring core UM functions back in-house, it’s more than just a workflow change; it’s a strategic shift that can impact every part of the organization. This transition often means new technology, updated processes, and a fresh approach to staffing. Internal teams may need to adapt to different volumes, new responsibilities, and unfamiliar systems.

“Being prepared is key. Health plans should anticipate the need for robust change management, including clear communication, comprehensive training, and ongoing support for UM nurses and staff. It’s also wise to consider flexible staffing models, combining internal teams with BPO partners or consultants, to handle fluctuating volumes and maintain high-quality reviews. By planning ahead and investing in staff support, health plans can ensure a smoother transition, minimize disruption, and set their UM program up for long-term success,” says Tani Herman, Senior Sales Executive at Availity.

Ready to Reclaim UM? Register for our Webinar!

Join Heidi Nielsen, Senior Director of Intelligent Utilization Management at Availity, and Krithika Srivats, SVP of Clinical Practice at Sagility, for a dynamic discussion on how leading health plans are modernizing UM by bringing core functions back in-house. Learn how hybrid models, powered by intelligent AI and clinical insight, are helping teams gain control, reduce disruption, and deliver better outcomes.

If you’re leading UM strategy, clinical operations, or digital transformation, this webinar will offer practical insights you can act on.

🗓️ November 13 | 12:00 p.m. EST

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