Quote from TFGPartner on May 23, 2025, 7:25 am

Managing an employer-funded health plan requires medical claims auditing
, which serves as an essential tune-up for the program. Comprehensively reviewing claim payments—an approach now common in auditing—can provide valuable insights into the plan's performance. Traditionally, audits relied on random sampling; this method barely scratched the surface of identifying recurring errors. Today, with technological advancements, it's possible to identify and address every mistake systematically, enhancing the efficiency of claims reviews and minimizing the need for extensive human oversight.

Electronic audits have become remarkably efficient, making it easier to spot errors. This process offers a glimpse into the costs incurred and the services rendered. You can gain significant insights by conducting audits and comparing the findings against the self-reported data provided by your external claim administrator. Audits also help meet regulatory and compliance obligations. An impressive aspect of quality claim audits is the established understanding that they can identify recoverable errors amounting to four times their cost, underscoring the importance of collaborating with skilled auditors.

Active participation from plan sponsors in the auditing process can enhance outcomes. Plan sponsors can pose specific questions to the auditor, tailoring the audit to their needs. While specialized auditing firms thoroughly examine all areas, this request for additional reporting is feasible thanks to today's advanced systems capable of instantaneously processing vast amounts of data. The level of detail available now in claims audits is extraordinary, a capability that was unimaginable just two decades ago, and the good news is that these detailed reviews typically come at no additional cost.

The accuracy of claim payments is often directly influenced by the setup of the system utilized by the health plan. Ensuring that your plan's provisions are correctly configured is critical. Auditors can evaluate in detail whether the design of your plan aligns with these provisions. Top-tier auditors incorporate this assessment as part of their routine work. With the detailed data in hand, it's ultimately the plan sponsor's responsibility to determine which errors warrant recovery. Some organizations pursue every recoverable error, benefiting from cumulative cost savings.