Health and prescription plans are constantly struggling against steep cost increases and how to manage them. It's why auditing claims becomes more crucial each year to ensure accuracy in payments and processing. Large employers that self-fund their benefit plans have a keen interest in double-checking their payments to ensure accuracy. The secret weapon aspect of claims auditing never came more clearly into view than with the arrival of the coronavirus pandemic. Costs and utilization rates skyrocketed, and new tests and treatments had widely varying pricing, sometimes astronomical. Audits helped plans cope.
What's been the game changer in claim audits has been technological advances. Combined with the arrival of specialist firms staffed by executives with claim processing experience, it means 100-percent of claims are checked against hundreds of data points. The speed and accuracy of these electronic reviews far outpace what was possible previously. It has earned the notice of management at all levels in sponsoring companies and organizations. Self-funded plans typically outsource their claim administration, and audits provide much-needed oversight. Therefore, they occur more often.
Avoiding surprises is one of the most critical aspects of financial management for any budget-conscious organization. Claim audits are excellent tools to understand cost trends while still in their infancy. Waiting longer to identify and understand them means it's more likely you'll be dealing with a million-dollar problem. There's also a trend toward keeping the audit software running continuously and reviewing claim payments in real-time. The result is monthly reports flagging all irregularities for closer review. It's a boon to in-house managers who want to keep closer tabs on their claim payments.
One interesting dimension to more frequent auditing is comparing the results against the self-evaluation that third-party administrators provide under their contractual agreements. If the two reports line up, you can have greater confidence in the accuracy of the self-review. If there are considerable discrepancies, you have the advantage of concrete data as the basis for your questions. Significant dollar figures are on the line with health and pharmacy claim payments, and keeping a close eye on the cash outflows is wise. If errors or irregularities are discovered, it's helpful to make the recovery attempt soon afterward.
