The American College of Physicians’ Recommendations for Effective Managed Care

1. The American College of Physicians (ACP) recommends that managed care plans promote only high-value, evidence-based, patient-centered care by reducing the use of low-value services, interventions lacking clear clinical indication, and treatments that pose unnecessary medical or financial risk to patients.

2. Utilization management policies should be grounded in high-quality evidence, established clinical guidelines, and widely accepted clinical recommendations.

Evidence Rating Level: 1 (Excellent)

Study Rundown: Most health plans in the United States use managed care models designed to coordinate how patients access services, improve health outcomes, and keep costs predictable. These plans typically involve defined provider networks and structured oversight of tests, treatments, and referrals. While managed care can help limit low-value or unnecessary services, it has also faced criticism for emphasizing cost savings in ways that may restrict needed care or make it harder for patients with complex health conditions to get coverage. This American College of Physicians (ACP) position paper explains how managed care should operate and offers recommendations to protect the patient-physician relationship. The ACP stresses that cost-control efforts should focus only on cutting low-value or non–evidence-based services, not on limiting treatments that are clinically necessary. Utilization management policies, such as requirements for prior authorization, should be grounded in high-quality evidence, clinical guidelines, and specialist input. The paper also highlights the need to reduce the administrative workload created by these policies and ensure that both patients and clinicians have a straightforward, patient-centered process for appealing utilization decisions. The ACP recommends that all managed care plans undergo third-party accreditation, be licensed by state regulators, and provide transparent, easy-to-understand information about coverage and benefits. Consumer protections should be clearly communicated. Insurers should also issue timely payments and compensate physicians for administrative tasks tied to managed care. Overall, these recommendations aim to ensure that managed care delivers high-value, evidence-informed care without restricting necessary services or disadvantaging patients with complex medical needs.

Click to read this study in AIM

Relevant Reading: Comparison of Low-Value Services Among Medicare Advantage and Traditional Medicare Beneficiaries

In-Depth [expert opinion]: This position paper outlines recommendations to ensure that managed care plans support the delivery of high-value, necessary care. Developed by the ACP’s Health and Public Policy Committee, the paper draws on English-language peer-reviewed studies and policy reports identified through PubMed, Google Scholar, journals, U.S. government agency websites, and research organizations. Data-driven sources were prioritized, though opinion pieces were included to contextualize the broader policy environment. The ACP states that utilization management practices should promote evidence-based, patient-centered care by reducing only low-value or non-indicated tests, treatments, or medications, particularly those that offer little clinical benefit or may pose medical or financial harm. Routine and clinically appropriate care should not be delayed or denied. Prior authorization requests must be reviewed by properly trained and licensed clinicians, and utilization management policies must be grounded in widely accepted clinical guidelines that are regularly evaluated and updated. Criteria used to make utilization decisions, including supporting evidence, algorithms, and any AI-based tools, should be disclosed, and data on prior authorization requests should be publicly available. The ACP also calls on health plans to reduce the administrative burden associated with utilization review and to offer clear, patient-centered pathways for appealing decisions. To ensure adequate access, plans should adopt qualitative and quantitative network adequacy standards and use quality rating programs that evaluate patient experience, delivery of high-value care, outcomes, and administrative performance. All managed care plans should be accredited by a recognized third-party body and licensed by a state regulatory authority. They must provide transparent benefits and coverage information, as well as resources for patient advocacy and counseling. Strong consumer protections should prevent fraudulent or high-pressure sales tactics and ensure that coverage remains affordable and accessible. Patients should have access to a regular primary care physician who can coordinate referrals to specialty care. The ACP also recommends a standardized, centralized credentialing process to reduce administrative duplication. Finally, fair contracting and payment policies, including prompt claims payment, prohibitions on inappropriate clawbacks, and adequate compensation for administrative tasks, should be implemented. These guidelines aim to ensure that managed care plans fulfill their intended purpose: supporting high-quality, evidence-informed care while limiting only low-value services.

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