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The cost savings come in the form of lower admission rates, lower expenditures on inpatient services, and a decrease in cost of ancillary services. This results in a reduction of cost for the provider.
The long term effect for this short term reduction in cost may prove to be negative. The reduction in utilization by the reviewers, which are employees of the hospital, may be based on decisions that are less than informed and therefore less than desirable. The less informed decisions are because the utilization reviewer is frequently not a physician. This may ultimately result in the decision for less utilization causing it to be necessary to treat patients in the future that were initially denied care due to the utilization review...
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