The Health Care Financing Administration (HCFA) projects that national health care costs will double
from $1.0 trillion in 1996 to $2.1 trillion in 2007, an increase of 6.8% annually. Over this time period, health spending
as a share of the gross domestic product is estimated to increase from 13.6% to 16.6%.
With multi-million dollar medical benefit plan budgets, it is critical for those individuals charged
with ensuring the financial stability of the plan to be assured that the insurance company or benefit administrator is
properly interpreting and reimbursing all medical claims submitted by their members. This age old reality has provided
the impetus for Locey & Cahill, LLC to develop the Quality Assurance Audit to ascertain that your benefit administrator
is utilizing all measures available for the cost-effective evaluation of your health benefit claims.
Regardless of who administers the benefits of your health plan and processes your claims, errors
will occur. This is primarily due to the required level of sophistication in terms of processing software, claims coding
technology, plan design and mandate complexity. Further, medical and dental claims are considered to be some of
the most error prone in the insurance industry because of the sheer volume facing daily consideration under these
circumstances. Some errors may be the result of genuine mistakes made by qualified claims processors, while
others can be the result of the benefit administrator not following plan guidelines or standards set forth in the industry.
In addition, with self-funded or even minimum-premium plans, there can be very little incentive for a
benefit administrator to control costs. More importantly, it has been established on many occasions that some benefit
administrators may not have adequate controls in place to efficiently administer the plan and pay claims in a timely and
accurate manner.
Why Audit Your Benefit Administrator?
Can you answer all of the questions below with complete and unfaltering confidence?
- Would you be able to detect hidden fees or recognize charges that could be applied in excess of any
agreed upon billing arrangements?
- Are you certain that your benefit administrator is processing claims as outlined in your plan booklet or
contractual agreement?
- Can you detect benefit amounts that have been allowed excessively?
- Are you able to gauge the value and efficiency of your benefit administrator against their contemporaries?
- If one percent of repeated inaccuracy equaled thousands of dollars in erroneous benefit allowances,
would you consider this to be an acceptable practice?
- How many other line item expenses in your corporate budget of this monetary magnitude are not strictly
monitored?
Quality Assurance Audit
The main difference between the Locey & Cahill Quality Assurance Audit and traditional audits performed by accounting firms is that our evaluation incorporates an analysis of the complete administrative process, along with a comprehensive claim review. This multifaceted and comprehensive analysis successfully tracks an administrator's activities from the point of claim reception until the explanation of benefit statement is processed and released. These features enable the Audit Team to provide our clients with a thorough understanding of the claim administrator's processing environment and performance.
The Quality Assurance Audit services include, but are not limited to, the review of:
- Administrative Policies & Procedures
- Benefit Application & Interpretation
- Appopriate Medical Treatment & Claim Submission
- Claim Payment Accuracy
