Third-party claim administrator and pharmacy benefit manager audits serve a critical purpose in identifying overpayments and other inaccuracies, which is vital for large employers self-funding their health plans. Financial recoveries from these audits play a pivotal role in controlling costs. However, there are additional significant long-term advantages associated with this process. One key benefit is the implementation of system improvements that minimize the likelihood of future errors. Such improvements enhance member service by ensuring consistent and equitable payment of claims.
Demonstrating oversight capabilities to TPAs and PBMs fosters accountability and encourages better performance. The accuracy of claim payments hinges on two factors: system setup and system precision. Each plan has its unique provisions, making medical billing a complex process. Despite effective setup and maintenance, errors can still occur, and even a small percentage of mistakes can translate to substantial financial losses, especially when medical services are costly. Audits that meticulously examine every claim can identify and flag discrepancies, leading to potential recoveries.
As plan sponsors navigate cost escalations, prioritizing claim payment accuracy becomes increasingly essential. The significance of this issue is underscored by unexpected events, such as the recent pandemic, which has further heightened the stakes for financial management. Consequently, many plan sponsors are opting to conduct more frequent audits and, in some cases, to implement continuous monitoring of claims. Monthly reporting on claim payments and their accuracy can yield numerous benefits, as errors identified early are typically easier to address than those that linger for months.
In addition to relying on the audit to uncover mistakes, the insights gained from the findings can offer valuable information to management. By making specific inquiries, plan sponsors can ensure these concerns are incorporated into the audit process. With advancements in technology, electronic reviews of claims can be conducted more quickly and accurately than ever before, enabling the examination of thousands of claims across numerous data points. Transparent reporting of these findings enhances long-term plan management, allowing sponsors to analyze cost and utilization trends effectively.