Cost Containment is a Goal of Health Plan Audits


Employers covering benefits for their employees do so to attract and retain good talent. But the costs of benefit programs, especially medical and prescription drug coverage, continually increase. As self-funded plans struggle to contain costs, healthcare auditing companies can help. Their careful review of claim payments can flag costly errors and help prevent similar ones from occurring in the future. Their contribution to cost management has increased as technology has improved so that audits review 100 percent of claims paid. As a result, they help plans recover payments made in error.


Beyond the usual yearly escalations, some moments bring extraordinary increases in medical bills. A recent example was the coronavirus pandemic that put the healthcare payment system under once-in-a-lifetime stress. Novel tests and treatments had widely varying prices (some astronomical), and utilization spiked remarkably. One way to manage the crisis was to audit claim payments quickly to develop detailed data about what happened. It’s common for claim processors to collect and report data, but auditors can look in greater or different detail. Seeing what happened is always helpful.


Every plan sponsor desires to provide excellent health care for covered employee members. When funds are drained because of overcharges or mistaken payments, it falls short of delivering the value plans have promised. A thorough claim audit can get things back on track and prevent errors from repeating in the future. It shores up finances, reduces budgetary pressure, and conserves funds for covered items provided and billed correctly. The importance of the correct system setup from a claim processor cannot be overstated. It’s why implementation auditing is also always a wise idea.


When health and pharmacy benefit plans are designed, they necessarily contain thousands of provisions and details. As a result, processing and paying claims becomes a function of implementing those details. While claim administrators have their methods for achieving accuracy, having the independent review of an auditor is instructive. When administrators report their findings, they’re policing claim payments using the same system that made them. Auditors have separate systems that can detect other issues. Comparing a processor’s self-reporting to the findings of a professional auditor is enlightening.



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