Tighten Up Benefit Claim Processing with Audits

[TFGPartners]

Over the years, many larger employer-funded benefit plans have opted to outsource claim processing to large insurance carriers and pharmacy benefit managers, touting cost savings and superior results. However, the promises need verification by doublechecking claims in a medical and Rx audit to ensure commitments are being upheld and potential efficiencies are being maximized. While third-party administrators offering processing services often make performance guarantees and promise self-monitoring, routine and thorough independent auditing remains crucial to validate the outcomes. 

The importance audit reports in demonstrating this cannot be understated. Audits present a significant opportunity to streamline claim processing and prevent errors specific to plan details. As each layer is added to an extensive claim processing system, unique features may be overlooked in favor of defaults, potentially missing opportunities, especially concerning a specific member population. By meticulously inputting a plan's summary description, audits can flag such items for correction. With a high claim volume, the savings can be substantial, ultimately benefiting members through increased accuracy. 

Pharmacy benefit managers are also not immune to errors, and audit findings related to their work are vital. While most plans require generics to be dispensed when available, costly name-brand medications often slip through. A claim audit can promptly identify such issues, encouraging providers to adhere to the rules when they know that active oversight is in place. Similarly, TPAs and PBMs can improve their accuracy with minor system edits to rectify errors. It has now become standard for employer-funded health and prescription plans to conduct more frequent self-audits than what regulators require. 

The noteworthy improvements in audit accuracy have made them excellent management tools. It was further emphasized during the coronavirus pandemic, as audit reports flagged excessive charges and prevented future occurrences of such overcharges. An increasing number of companies are embracing continuous monitoring of claim processing and payments to flag mistakes in real-time and control costs. We’ve also entered an era of fiduciary breach lawsuits and they also underscore the value of claim auditing and more careful plan management. The data from audit reports is helpful in those situations.