There’s a troubling trend among large administrators to prevent plan sponsors from effectively auditing their claims adjudication. Unfortunately, audits are one of only a few ways employers can hold TPAs and PBMs accountable for applying reasonable claim controls. After all, if they win new business by having broad networks, lower discounts, and lower fees, the easiest way to prop up that facade is to automatically pay almost every claim submitted by providers.
If you don’t want your administrator spending your money without reasonable claim controls, make sure you avoid contract language that…
- Charges the employer for audits
- Restricts the methodology to random only
- Severely restricts the audit period
- Limits the number of samples to be reviewed
- References a separate agreement that is not part of the primary
- Prohibits reimbursement of errors under a specific dollar amount
- Limits the available data fields needed to perform the audit
While restrictive language like this doesn’t preclude you from doing an audit, it all but assures inconsequential results. What if you could only withdraw your money from the bank in $50 increments on Wednesdays between 9:00 and 10:00 in the morning? It’s kind of like that.
Let a member of the Chelko team know if you have questions or want help in avoiding this trap.