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Large employers with self-funded medical plans often receive promises of efficiency and savings from claim administrators when negotiating service agreements. However, the reality may not always agree. To truly assess whether these commitments are being met, running medical claim and pharmacy benefit manager audits can deliver insight. Comprehensive audits that review 100% of claim payments—as well as all charges billed by your TPA and PBM—can uncover variances and ensure accountability. Given the substantial sums involved in medical claims, even slight errors can result in significant, unnoticed losses.
Modern claim audits apply advanced technology to examine every payment with far greater accuracy than in the past. Today’s auditors carefully review all facets of your claims, including any fees imposed by your TPA or PBM. As independent professionals, their sole purpose is to ensure your organization maximizes the value of every dollar spent. While it is not uncommon for new fees to arise after a contract is signed, these should only be applied if your agreement is properly amended with your explicit approval. Vigilant audits help prevent unwarranted charges from getting through unnoticed.
For plans that have exceeded budget expectations without a clear reason, a comprehensive audit can uncover the sources of overspending. Each claim payment presents a risk for errors or overcharges, particularly as healthcare costs and billing complexities continue to rise. Diligent ongoing auditing and monitoring are key to effective cost control. Pay special attention to negotiated out-of-network services, subrogation, and attempts to recover overpayments, since these are common areas where TPAs may impose additional fees. Consistently verify these charges to protect your plan’s financial status.
While you may consider your TPA as your sole outsourced vendor, it’s important to recognize that TPAs themselves sometimes subcontract portions of their work. These subcontractors may then charge your plan commissions—frequently ranging from 10 to 30 percent—for services such as subrogation and overpayment recovery. If overpayments are the result of TPA errors and your plan is subsequently charged a commission to recover those funds, it can lead to questionable and potentially inappropriate expenses. Implementing thorough claim audits safeguards your organization and its budget.
Modern claim audits apply advanced technology to examine every payment with far greater accuracy than in the past. Today’s auditors carefully review all facets of your claims, including any fees imposed by your TPA or PBM. As independent professionals, their sole purpose is to ensure your organization maximizes the value of every dollar spent. While it is not uncommon for new fees to arise after a contract is signed, these should only be applied if your agreement is properly amended with your explicit approval. Vigilant audits help prevent unwarranted charges from getting through unnoticed.
For plans that have exceeded budget expectations without a clear reason, a comprehensive audit can uncover the sources of overspending. Each claim payment presents a risk for errors or overcharges, particularly as healthcare costs and billing complexities continue to rise. Diligent ongoing auditing and monitoring are key to effective cost control. Pay special attention to negotiated out-of-network services, subrogation, and attempts to recover overpayments, since these are common areas where TPAs may impose additional fees. Consistently verify these charges to protect your plan’s financial status.
While you may consider your TPA as your sole outsourced vendor, it’s important to recognize that TPAs themselves sometimes subcontract portions of their work. These subcontractors may then charge your plan commissions—frequently ranging from 10 to 30 percent—for services such as subrogation and overpayment recovery. If overpayments are the result of TPA errors and your plan is subsequently charged a commission to recover those funds, it can lead to questionable and potentially inappropriate expenses. Implementing thorough claim audits safeguards your organization and its budget.