The most apparent value most plan sponsors see in health plan claim audits is the recovery of overpayments. But the longer-term and more significant value of medical claim auditing services lies in flagging errors that point to system setup mistakes. They're the ones that cause large batches of mistakes that over time add up to significant losses (or costs) and necessitate time-consuming correction and recovery efforts. Therefore, audits have value in many ways and can improve member service and ensure that all members and their claims are treated fairly and equally. Any setup issue you fix helps in the long run.

Any time your plan switches to a new third-party administrator (TPA) for medical claims or pharmacy benefit manager (PBM) for prescriptions, an implementation audit after 90 days is a wise investment. It's the only way to be sure your plan setup is correct in their system and that claims are being paid in with the promised accuracy. If you have performance guarantees built into your contract, independent verification lets you know if they are being met or not. High-performing TPAs and PBMs welcome auditing as proof of their high-quality service. Any that resist it may be telling you something indirectly.

Most TPAs and PBMs handle many plans and have standardized setups in their system. But your plan has unique attributes that vary in complexity. Implementation auditing will help you get off to an accurate start and ensure the transition to the new vendor stays on track. It's wise to audit early and often also because high-caliber claim auditing often finds savings up to four times the cost of the service. It's an eye-opener for many plan managers. Also, if you've been accustomed to random sample audits which have limits in their accuracy, find an auditor that reviews 100-percent of your claim payments.

TPAs and PBMs make many promises about the accuracy and value of their service, but without oversight, you're left to take their word for it. Most are faithful to their contracts and intend to perform well, but only an independent review can confirm whether it's happening. Once you have an audit, it's wise to follow it up with a continuous monitoring service. It provides monthly reporting that flags errors and calls your attention to trends developing in your claim payments and processing. It's the best way to stay on top of costs and member service in real-time. Without it, you must wait for the next audit to find out.