When health care costs skyrocket, medical claim auditing is one of the best ways to review what happened. Large employers, corporate or nonprofit, that self-fund their plans for many good reasons need to keep tabs on costs. Events like the coronavirus can cause budget overages of legendary proportions, and double-checking results from outsourced claim administrators is vital. Flagging and correcting individual mistakes is an opportunity but finding systemic errors that repeat is generally what leads to the most substantial savings. System fixes to prevent similar future errors are essential.
Pharmacy benefit plans and medical plans offer the most significant potential savings after auditing, but it makes sense to audit claims for any benefit plans. Any benefit program with claims paid presents an opportunity for errors and the chance to recover them. Specialist audit firms have improved their software considerably, and it means faster reviews, more accurate results, and less time involved to generate them. Few people now recall the days of random sample auditing and more manual reviews of the results. Today 100-percent of claims are routinely checked, and the errors are flagged immediately.
For good reasons, many people make a case for hiring a specialist claim auditing firms. One of the chief reasons is the never-ending changes in claim processing errors and irregularities. Each year brings subtle changes that can affect costs and claims payments. As a result, having auditors who specialize in the field and are in the trenches every week makes a difference. They are often the first to spot new error patterns and flag them for correction and recovery of overpayments. Financial recoveries are vital to any self-funded plan's financial health, and for large employers, they make an even more considerable difference.
If your plan is about to switch to a new third-party administrator for claims processing, plan an implementation audit around the 90-day mark. You'll have enough data by then for a worthwhile audit and be reviewing the processing before any repeating errors become significantly out of hand. The goal is to keep plans functioning optimally at all times while serving their members and controlling costs. Claim payment errors also often cause a disparity in benefits administration among members. When some have their claims paid differently than others, there is unequal treatment of plan members.