Large employers sponsor medical and prescription benefit plans for compelling financial and business reasons, working to attract and retain talent while guaranteeing the well-being of their workforce. However, these plans involve substantial costs and exposures, making close oversight crucial. As claim processing is increasingly outsourced to third-party administrators (TPAs) and pharmacy benefit managers (PBMs), medical claim and PBM audits have become more critical than ever. Even reputable TPAs and PBMs with effective systems can overlook specific provisions unique to each employer’s plan.
The shift from random sample checking to 100-percent claim audits has transformed the industry, bringing about an era of heightened accuracy. With advanced electronic tools and expert human review, every claim can be reviewed for compliance, uncovering errors and inefficiencies that would otherwise remain undetected. This thorough approach enables early detection of emerging trends that could spur future cost increases, empowering plan sponsors to act proactively. By intervening through negotiations or targeted outreach, sponsors can address complications before they escalate.
Engaging independent, specialist claim auditing firms brings additional value to plan sponsors. These firms possess deep expertise from conducting audits daily across a range of clients and scenarios, allowing them to spot subtle variances and industry trends more efficiently than generalist firms. Their independence secures a truly unbiased review, free from conflicts of interest, so that all findings are reported transparently and all opportunities for plan improvement are revealed. This impartial perspective is rarely available from firms that also serve as administrators or benefit managers.
Performing an implementation audit approximately 90 days after switching to a new TPA or PBM is a best practice for plan sponsors, helping to identify and resolve matters early in the relationship. Additionally, ongoing monitoring—where audit technology continuously reviews claims in real time—provides substantial value. Furthermore, consistent audits improve the dependability of service delivered to plan members. For employees with high-deductible health plans, the accuracy of claim payments can have a direct impact on their personal finances, illustrating the importance of oversight.
