Where Claim Audits Fit for Health Plans

Employer-funded health plans have recently been in the spotlight due to legal issues. Some plan sponsors have initiated lawsuits against their claim administrators, and class action suits on behalf of members are in the works. Medical claim auditing may be pivotal to both the claims and defenses involved in these situations. An independent review of claim administration and payments is crucial for validating the work of third-party administrators or pharmacy benefit managers. Given that they process thousands of claims weekly or monthly, mistakes can occur despite having advanced systems.

Auditors are essential for identifying and correcting any errors. While the rates of claim payment errors have been driven down significantly, the high healthcare costs mean that even a few mistakes can result in substantial financial implications. Therefore, it is important to maintain finely tuned processing systems, and auditors play a critical role in this aspect. When you engage a firm with experienced personnel in claim payment systems, their auditing capabilities are often superior. They can electronically analyze thousands of claims in a matter of minutes, checking for overpayments.

With technological advancements, audit accuracy has dramatically improved. Therefore, today, there is a strong case for conducting frequent claim audits—one that is grounded in effective plan management and cost containment. Given the intricacies of medical billing, the potential for subtle errors is substantial. Previous random sampling practices would only catch significant error patterns, but modern techniques allow for identifying individual errors that can be corrected and recouped financially. Adjusting claims administration systems to prevent future mistakes is advantageous.

Working with the same auditor over time can yield benefits, as they can assess current performance against past performance. Nevertheless, it is valuable to explore other firms to see if their methods and services surpass what you currently utilize. For instance, a large audit firm that offers bundled services may not provide the same level of specialization as a firm focused solely on claims reviews. Their expertise can work in your favor, and if their pricing is competitive, it can lead to significant benefits. You will notice both immediate and long-lasting improvements in your audit processes.