Undoubtedly, health and pharmacy plans are the most significant expenses in the array of employee benefits self-funded by large employers. As a result, you can see why medical claim auditing services get much of the attention. But it's wise to routinely audit all benefit plan claim payments, if not monitor them continuously. When cash goes out the door and third parties manage it, companies as plan sponsors can't afford to take it lightly. There are performance guarantees to anyone handling claim administration, but no one is perfect. Therefore, running oversight is a sponsor's responsibility.
Even with all the excellent reasons for companies and large nonprofits to self-fund benefit plans, they need to be well-run for them to matter. The mix has fiduciary responsibilities, such as ensuring that funds are spent appropriately. Because claims payments are the primary cash outflow, they deserve scrutiny and must be well run. The good news is that claim administrators today routinely have error rates of no more than a few percentage points. It may sound like so few mistakes, but it's not a big concern; the totals can be added quickly, regardless of the benefit plan type, and correcting mistakes matters.
When you find an experienced claim auditor, see if they have reviewed your processor previously for another client. There's a strong chance they will answer yes, and you'll know they will start the job with relevant experience. It allows more time to consider your plan's specific provisions to ensure they are included in the audit. Greater customization improves the chances for accuracy and turning up things that others might miss. Now that 100 percent of claims are double-checked and can be across all benefit plans, you can recover all significant overpayments. It's why claims audits pay for themselves.
Advancements in technology, specifically software, have ushered in a new era in claim auditing. The proprietary systems built by the leading firms have vastly improved their efficiency and accuracy. Many have senior staff members with health plan experience, giving them first-hand knowledge of claim administration. Combining that knowledge with audit expertise is a powerful combination that leads to better results. Accurate audits are more cost-effective because they produce more precise results, making more recoveries possible. It works for all benefit categories where members' claims are paid.
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