Health Plan Audits and Their Increasing Value

As the costs of medical services and prescription drugs keep rising, employee benefit plans experience mounting pressure to stay financially healthy. Comprehensive audits act as essential tools toward maintaining oversight. Today’s medical claim and pharmacy benefit manager audits must review an ever-broader array of covered services, medications, negotiated pricing systems, maximum allowable charges, and rebates. The claims paid by claim administrators and PBMs are growing in both volume and intricacy, making regular and thorough oversight more important than ever.

When auditors begin their review of medical and pharmacy claims, their first step is to verify the eligibility of each individual who received a covered service. They then undertake detailed electronic audits, examining invoices to ensure charges do not exceed contracted rates or reasonable and customary limits. Duplicate charges are frequently uncovered and flagged. Advanced auditing software reconciles invoices for accuracy and identifies any improper administrative fees. Given the high volume of claims, these practices may uncover considerable opportunities for financial recovery.

An essential part of claim auditing is reviewing cost-sharing arrangements and confirming that plan limits per member are enforced. This guarantees fairness, preventing some members from receiving disproportionate benefits. Auditors also verify that coordination of benefits is pursued whenever possible, as failing to do so can result in unnecessary costs. Although most agreements now include performance guarantees, it is vital to check that these standards are consistently being met.

Modern 100-percent audits offer a level of accuracy that was previously not achievable with older random-sample methodologies. Specialist claim auditing firms constantly improve their proprietary software and techniques. Their relentless focus on accuracy and carefulness means that plans may recover significant sums that might otherwise have been lost. For many organizations, these recovered funds are important for financial sustainability. Taking advantage of comprehensive, technology-enabled audits is a smart way to keep your plan fiscally secure within an increasingly complex healthcare arena.