With outsourced administrators paying millions of dollars in claims a week for employer-funded health plans, active oversight of their work is essential. It’s why plan sponsors routinely use medical claim auditing services to review their payments. Regardless of the era or circumstances, claims audits prove their value in myriad ways – the most recent example was the coronavirus pandemic. When utilization and costs spiraled out of control, plan sponsors turned to auditors to analyze and report on the activity. Plans increasingly have real-time auditing and monthly reporting to run more active oversight.

Never-ending technological advances have perfected the science of auditing healthcare claims, and today’s accuracy is impressive. When all claims are double-checked, the potential to find every error is there. If you think about the old random sampling method, the results change if you repeat things because you’d be pulling a different sample. With the 100-percent audit method, you have consistency, and if any portions are re-run, they complement and align with the original results. Over time, as monitoring and auditing continue, all irregularities in claim payments are flagged and reported to you.

When you’re in-house at a benefit plan sponsor running oversight of outside contractors, there may be things you want to check. Auditors can help, and when you add questions in the audit setup meeting, it helps ensure the report will include the answer you’re seeking. There’s no doubt that today’s processing error rates are low, but even minor repeating errors can be costly. The best-managed plans pay every claim correctly and correct any mistakes soon after they occur. When you work closely with an auditor, the information is reported routinely. It allows you to request system fixes to solve the issue.

In just the past year, some new reasons to audit claims have frequently come into view and involve the courts. Activist law firms are planning class-action fiduciary responsibility breach lawsuits against some plan sponsors, while other sponsors are the plaintiffs in legal action against their processors. It all points to the need to keep closer tabs on your plan’s claim payments and your processor’s work. When you catch mistakes soon after they were made, you prevent them from spiraling into more significant problems, and it’s easier to request reimbursement for overpayments. There are many ways to benefit from audits.