Audit Benefit Claim Payments for Accuracy

Managing employer-funded health plan claims is no small feat. Today’s third-party administrators (TPAs) and pharmacy benefit managers (PBMs) work with impressive accuracy. Still, TPA and PBM audits uncover mistakes or irregularities. With the volume of claims and the complicated nature of billing, it’s clear why regular claim reviews are so important. Auditors themselves have also become more sophisticated, bringing cutting-edge technology and expertise to the process. They combine technical skills with a strong understanding of medical billing to deliver thorough, meaningful audit results.

Not long ago, many employer-sponsored health plans handled all their claims in-house, giving them direct oversight of every payment. Over time, however, more organizations began outsourcing this responsibility to TPAs and PBMs. The reasoning is simple—these specialized processors, often large and well-resourced, have the technology and systems to pay claims more efficiently. This move toward standardization streamlines operations and reduces administrative burden. Still, it’s essential that these processors’ systems are configured to follow each plan’s unique rules and provisions.

Almost every TPA and PBM promises claim processing accuracy, often with performance guarantees in their contracts. But how do you know if these guarantees are being met? The only way to truly verify is by having an independent third-party auditor review the payments. Audit firms regularly report that it’s unusual to complete a review and not find at least some errors. This makes independent audits a powerful management tool. Many audit firms have leaders with backgrounds in claims administration and hands-on experience working for large health plans, giving them valuable insights.

Plan sponsors can also request additional items to be included in the review, and setting up meetings is a good opportunity to discuss any unique needs. Comparing an independent auditor’s findings with the reports generated by the claim processors themselves can reveal interesting differences. Importantly, auditors use systems that are completely separate from those that process the claims, providing a true second opinion rather than just a re-run of the same data. This independent approach is essential for catching errors and gives plan sponsors greater confidence that claims are being handled correctly.