Helping to contain ever-rising medical costs is often a chief goal for health plan auditing services. Their work catching mistakes and overcharges gives plan sponsors (typically large employers, either corporate or nonprofit) a financial recovery opportunity. Health plans with sizeable memberships covering medical and prescription medicines pay thousands or millions of dollars per month. Finding errors of all types can help recoveries in the large volume of claims paid. It also can help eliminate those mistakes in the future as claim processors make system improvements.

The value of claim audit reports has increased over the years because of three factors. The first is rising health care costs; the second is the trend towards outsourcing claim administration which means plan sponsors need an oversight mechanism; the third is improved technology and software that make the audits far more productive than previous random samples. As the data becomes more detailed, it is easier to use and gives a snapshot of a plan's performance at any moment. With large dollar volumes involved and the stress on every organization's bottom line with inflation, paying every claim accurately matters.

Claim processors might report data to plan sponsors in the aggregate, and auditors can help make it more specific. For example, if costs are generally increasing or in particular sectors, claim audits can confirm exactly where they have occurred. Comparing results against previous periods also sheds light on usage patterns and confirms, or adds more perspective, to what third-party administrators or pharmacy benefit managers are reporting. The is no substitute for independent verification with no agenda other than a plan's best interests. Auditors work that way and understand close oversight.

Besides the needed regulatory and compliance reporting, claim audits can be adjusted (or focused) to produce data in other areas. For example, member eligibility can be double-checked. It's also helpful to look at code pairs and whether redundancy is occurring. Your claim processor may already be policing and reporting on these factors by adding an extra layer of oversight is helpful. Plan performance is the sum of many smaller parts. When audits help you drill down into the details, you have the data you need at your disposal to make meaningful adjustments. In the long run, it will help contain costs.