When large employers with self-funded medical plans negotiate their service agreements with third-party claim administrators (TPAs), there are always promises about efficiency and savings – but is it going as promised in the long run? One of the best ways to find out is to work with an independent medical claims auditing company. When they review 100-percent of claim payments and any charges going to your company's TPA, you'll have the answer. Because medical claims numbers are generally large, it's common for significant sums to go unnoticed. An auditor will find and flag them for you.

Because today's high-quality claim audits review every payment, their accuracy is far beyond what was possible years ago. Better methods and continuously improved software help them examine every aspect of your claim payments, including charges from your TPA. Independent auditors have no agenda other than to help your plan and company get the most for the dollars it spends and to make sure you aren't overpaying. It's natural for new TPA fees to be added after your agreement is finalized, but they should not be charged to your plan unless your service contract is suitably modified with your sign-off.

If you've never before reviews your TPA's charges, it's well within your purview to do it. For any plan that has been over budget in recent months without a clear explanation about why auditing every aspect can prove insightful. Every claim payment brings the opportunity for mistakes or overcharges, and as medical services and their costs become more complicated and higher, auditing and monitoring become more essential. Negotiations about out-of-network services, subrogation, and recovery of overpayments are areas where TPAs typically assess charges against a plan; always double-check yours.

In your mind and from your company's perspective, it may seem as though your TPA is the outsourced vendor. But TPAs sometimes outsource part of their work, and their vendors might charge your plan a commission. Commissions to their vendors range from 10 to 30 percent and often occur for subrogation and overpayment recovery. When overpayments occur because of TPA errors and your plan is charged a 30-percent commission to recover them, you can see quickly how it may appear to be entirely inappropriate. Claim audits and continuous monitoring are two ways to implement detailed oversight.