For self-funded medical plans, nothing is worse than incurring costs that don't benefit plan members. It's why the work of medical claims auditing firms is so essential to excellent plan performance. Mistakes in claim processing that waste dollars hurt the company and organizational bottom lines and are of zero benefit to employees covered by the health plan. Errors that repeat add up to high unnecessary costs over time, so catching them early is a significant advantage. It's why the more accurate 100-percent claim auditing method that has replaced random samples is a vital improvement.
Better software refined and continuously improved by the top audit firms specializing in medical claim reviews has driven the improvement. Large health insurance carriers that act as third-party administrators (TPAs) for self-funded plans may overlook some fine points in the plan description. When it happens, overpayments can occur, and depending on the category, they can be costly and challenging to recover. Full-service claim audits and monitoring that check every claim paid are a plan manager's best tools to catch and correct errors. TPAs work more carefully when there is consistent oversight.
In publicly traded companies where employee health care costs show up on balance sheets and affect quarterly earnings reports, the stakes couldn't be higher. The recent COVID-19 pandemic and its related medical expenses – shockingly high amounts for routine services in some cases – brought the need for self-funded plan oversight into the spotlight. The increased costs hit companies in one of the most unpredictable financial years in decades. Having oversight through audits and monitoring and working closely with TPAs to understand where appropriate to dispute overcharges was never more critical.
Since then, more self-funded plans have strongly considered a continuous claim payment monitoring service if they did not have one in place already. The purpose is to leverage all the benefits of advanced claim auditing software and use it in real-time. The costs are budget neutral in most cases because the monitoring service flags correctible mistakes with a value higher than the price of the service. It also empowers plan managers in dealing with TPAs because there is no substitute for having factual data in hand. Company management at all levels benefits from better plan oversight.