How Self-Funded Health Plans Accurately Pay Claims

Company Medical and Benefit Claims Auditing | TFG Partners


There is no doubt that the past ten years have brought a review of nearly every cost center in a large corporation or nonprofit. The reviews, often conducted by management consultants, commonly recommend outsourcing to cut costs. It's meant that many self-funded health plans now have others pay their claims – and medical bill auditing services have immediately become more critical. When a third-party administrator (TPAs) oversees large outflows of funds, there must be proper and detailed oversight. Mistakes and overpayments are all too common to be overlooked by a plan
Neatly every agreement between a TPA and a self-funded medical or pharmacy benefit plan will have certain performance guarantees. But the only way to know if they are being met is to audit. It's meant to be a management support function and not create an adversarial relationship between the two parties. For private-sector employers that self-fund medical plans, increases in costs or budget overruns affect balance sheets and show up in quarterly earnings reports. Because they can affect stock prices, medical expenses become an issue for senior executives and boards of directors. It means accuracy is essential.

The recent coronavirus pandemic caught everyone by surprise, including self-funded plans, and it was an extraordinary cost event. As managers and executives have struggled to see clearly where the money went, auditing has been thrust into the spotlight. The good news is that today's most sophisticated auditing software is up to the challenge of checking 100-percent of claims paid and quickly reporting accurate and thorough data about them. It flags mistakes, uncovers patterns of fraud and abuse, and helps recover overpayments. Some providers overcharged legendarily during the pandemic.

One of the crucial elements of better self-funded plan management is information. Audits provide it as they keep in-house informed about claim payment experience. It also can be beneficial to investigate continuous claim monitoring services. It outs to use the same software in real-time to watch claim payments as they happen. It's an extraordinarily accurate way of conducting claim payment oversight and managing a TPA. Most companies that have tried it have benefitted enormously right from the start. Nothing ever becomes a significant problem because errors and overcharges are caught as they begin.