The ROI for Medical Claims Auditing

July 21, 2022

After AIM conducted a medical claims audit for a large bus company, the company was able to avoid an estimated $500,000 in inappropriate claim payments every year.

A regional public transportation system had been using the same medical claims administrator for its self-funded employee medical plan for many years. To ensure the administrator was performing at industry standards, the company engaged AIM to do a comprehensive audit of its financial accuracy and claims processing accuracy, as well as a focused audit of a sample of claims identified as potential duplicates.

While the AIM claims audit found the claims administrator was meeting industry benchmarks for claims processing accuracy and financial accuracy, it discovered a number of serious errors in claims adjudications:
• About $50,000 in contingency fees that were precluded in the service agreement were incorrectly charged to the bus company during the audit period.
• Pension Group members were incorrectly coded as “active employees” in the administrator’s system, causing issues with coordination of benefits when the early-retiree members aged into Medicare. The financial impact was estimated at $1.4 million unnecessarily paid by the plan.
• The focused audit of potential duplicates found five confirmed duplicates among the sample of 25 claims, with overpayments ranging from $350 to $2,800.

As a result of AIM’s detailed review, the claims administrator returned $50,000 in improper contingency fees to the bus company. The claims administrator’s systems were corrected to account for pensioners aging into Medicare, avoiding an estimated $500,000 in inappropriate claim payments every year. Finally, additional examiner training was provided, and system edits were installed to prevent future duplicate claims.
AIM continues to work with the claims administrator to improve the quality of claims administration provided to the regional public transportation system.


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