It's a meaningful event when large employer-funded benefit plans change claim administrators. Since medical and pharmacy claims are the most significant expenses, healthcare auditing companies should be involved. Implementation auditing is one of the most significant opportunities to catch preliminary errors and get things off on the right foot. Even the most advanced processing systems can make errors, and detecting them quickly pays off. If your plan needs to request overpayment recovery, doing it shortly after the fact is always smoother. Working several months in arrears is always more challenging.
Today's claim processing systems are built to be accurate, but things change rapidly, and not every setup can always be correct. Claim auditors who can detect errors quickly always add value, and today, they commonly review every claim – it's a leap ahead from the days when it was about random sample audits that were generalizations without pinpoint accuracy. Now, you can "slice and dice" claim payments in many ways electronically, reviewing them for many factors. Given the complexity of each claim, it's beneficial to have the ability. Medical coding is also a complex endeavor that creates complications.
The most effective healthcare claims auditing combines knowledge of advanced audit techniques with medical (and pharmacy) billing knowledge. The opportunities to find irregularities are significant when reviewing thousands of claims. The percentages may be low and make administrators appear effective, but the dollar amounts can be substantial when every incorrect claim is flagged. It also holds that the only way to know your processing setup is correct is to audit claims about three months after implementation. Conducting oversight of processors is a beneficial part of plan management.
Protecting your audit rights is crucial when negotiating an agreement with a new claim processor. Some may try to substitute self-reporting for an independent claim review or limit your rights in some instances. As a plan sponsor, the right should be yours because the plan is yours, and it's your company or nonprofit's money paying the claims. After the implementation phase, audit frequency is up to you, and you may elect to have the audit software run continuously. If you have monthly reports with factual data at your fingertips, you're in a much stronger position to manage your plan proactively.
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