Podcast

Negotiating Now Means 2025 Healthcare Savings!

Don’t Miss Your Negotiating Window!

Attention businesses with self-funded healthcare plans! While your team may be enjoying some well-deserved vacation time, third-party administrators (TPAs) and benefits managers are negotiating Administrative Services Only (ASO) agreements for 2025. This is a critical time to ensure your company gets the best possible deal, especially when it comes to audit rights.

Audit Rights are for Your Protection.

Self-funding healthcare plans offer cost-saving benefits, but they also come with fiscal responsibility. You’re on the hook for claims paid by the administrator to providers. Strong audit rights allow your company to verify the accuracy of those claims, potentially uncovering errors or extra fees and saving you significant money. But if you don’t have the appropriate audit rights, you could get burned and your savings washed away.

Don’t Bury Your Head in the Sand!

Many companies have no idea they should be auditing their claims data. HR executives and benefits administrators might think their broker or benefits consultant manages everything – but that’s a dangerous assumption. The responsibility for identifying and correcting errors falls on you.

During negotiations, ensure that your ASO agreement does not restrict your ability to audit the payer’s work. Here’s what you need to do:

Review your current ASO agreement: Understand your existing audit rights and identify any limitations.
Research industry standards: Benchmark your current agreement against what other companies are negotiating.
Negotiate for comprehensive audit rights: Push for the ability to analyze all claims data, select targeted claims for review versus random sample selection, and review provider contracts.

Get Help Protecting Your Bottom Line!

Healthcare Horizons is here to empower businesses like yours in your audit agreement negotiations, as well as with your comprehensive healthcare plan audits. We offer a complimentary ASO audit language review and provide recommendations to help you negotiate the best audit rights. This can be a valuable starting point for ensuring that your plan isn’t overpaying for healthcare benefits!

By acting now, you can ensure your ASO agreement delivers on its cost-saving promise for 2025. Don’t miss out – negotiate for robust audit rights, protect your company’s bottom line, and take advantage of Healthcare Horizon’s free audit language review. Contact us today at www.healthcarehorizons.com or 800-646-9987.

Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through our 100% Difference model and recovering millions of dollars for clients’ bottom lines while upholding the highest ethical standards. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for our customers.

inflation letters cutting through a hundred dollar bill

Fight Inflation in the New Year

Don’t Let Inflation Impact Your Healthcare Offering

Every year, saving money or better managing finances is in the top five on New Year’s resolutions lists. Businesses are no different. Your company may have just finished its budget review, or you may be planning during Q1, but the goal is the same: end 2024 with more profit than last year.

If the only things factored into your success were your income and expenses, it would be easy to ensure that your end-of-year number would be positive. But, just like our home finances, your business’ bottom line is impacted by external pressures, like unexpected maintenance expenses, personnel leaves of absence or even federal regulations. The biggest pressure facing families and corporations, however, is inflation.

Inflation Impacts All Aspects of Business

Some economists estimated an 8% inflation rate for 2022 and a 4.5% rate for 2023. While 2024 rates are expected to level off to around 3%, the impact of the significant rise in prices on goods over the past three years will be felt for years to come. Salaries will continue to be adjusted to allow employees to afford increased prices on groceries, utilities and rent. More dollars will need to be allocated to healthcare as well, by both individuals and companies. Fortunately, there are steps benefits administrators or human resources professionals can take to lessen the impact on a company’s bottom line.

Audits Drive All Solutions

To reduce expenditures from your self-funded health care plan, you must understand how your funds are administered. To do this, you need to audit your healthcare claims fully. Comprehensive audits that review 100% of your healthcare claims provide valuable insights, including patterns of inaccurately billed claims, and identify the best way to reclaim overpaid dollars. Transparency helps policymakers develop effective strategies to combat inflation in healthcare payments.

Once armed with the information garnered through your audit, you can use your findings to negotiate lower rates with providers, thereby reducing overall healthcare costs. As you find cost savings through better rates and reclaimed dollars, you can then advocate for policy change through implementation of targeted cost-containment measures, such as prior authorization programs or utilization management initiatives, which can further mitigate the impact of inflation.

It’s important to note that healthcare claims audits are not a one-size-fits-all solution to inflation. However, when implemented effectively, they can be a valuable tool for protecting against rising healthcare costs and ensuring that resources are used efficiently and effectively.

This new year, make your top business resolution to boost the fiscal health of your self-funded health care plan. Call today for a complimentary review of your current administrative plan and learn how our audit process can help your company’s bottom line.

Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through our 100% Difference model and recovering millions of dollars for clients’ bottom lines while upholding the highest ethical standards. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for our customers.

Why Your Budget Needs to Include Audits

Have you ever gotten a notice saying that you might have unclaimed money from a refund, settlement, or inheritance? What was your first reaction? Most people think about what they would do with this “surprise” windfall. But guess what? It was always your money! You just didn’t know it was missing. It’s time to put it back in your budget!

As the 2^nd biggest expense for most self-funded companies, healthcare plan line items should be an area of particular focus. In medical claims audits, we find errors 100% of the time through our comprehensive audits. Simply, if audits are not in your annual budget, you are throwing away YOUR money. Including a comprehensive medical claims audit in your annual budget is money well spent. It’s like the old adage: you have to spend money to make money.

Cost Containment Protects the Company Budget

Including comprehensive audits in the annual budget is a proactive cost containment strategy. With healthcare costs rising each year, and more high-value claims filed and paid by self-funded plans, it is no longer enough to assume your third-party administrator can catch every error.

The numbers tell the story. Each year, Americans file 232 MILLION healthcare claims!

Even if only 1% of the claims are incorrect, that is more than two million mistakes! In fact, the industry average is almost 3% in errors. Put a low average dollar amount of $1000 to every mistake and plans could be overpaying healthcare claims by more than TWO BILLION dollars!

Here are some examples of how ignoring mistakes in data claims would have cost companies thousands of Lost Benjamins but were thankfully caught through a comprehensive audit.

High-Value Claims are a Leading Cause of Error

In data compiled prior to the Covid-19 pandemic (2019 compared to 2015), high-value claims increased by double-digit percentages. (Information below summarized by Stop Loss Insurance Brokers.) These costs lead to higher premiums for the insurer and higher out-of-pocket expenses for the insured.

In 2019, 7 out of every 100,000 employees had a claim exceeding $500,000, up from 37.1 in 2015. That’s a four-year increase of 82 percent and an average annual percentage increase of 13 percent.
9 out of every 100,000 employees had a claim exceeding $750,000, up from 13.8 in 2015. That’s a four-year increase of 66 percent and an average annual percentage increase of 10 percent.
Eleven out of every 100,000 employees had a claim exceeding $1 million, up from 6.3 people. That is a four-year increase of 75 percent and an average annual percentage increase of 8 percent.
3 out of every 100,000 employees had a claim exceeding $2 million, up from 1.0 in 2015, a four-year increase of 130 percent, and an average annual percentage increase of 21 percent.

Our comprehensive audit system analyzes every claim. Our trained experts spot inconsistent trends in claims data, which occur in all claims, but have bigger negative repercussions the larger the claim amount. While a high-value claim on its own isn’t going to automatically have errors, the ones that do exist cost companies and employees deeply. Identifying these claims, particularly the systemic errors that occur when numerous claims are being made for one illness, saves companies thousands, and sometimes millions, in reclaimed overpaid dollars.

Comprehensive Audits Protect Your Budget and Bottom Line

Overpaid dollars, through inaccurately filed claims, can cost your healthcare plan thousands of dollars. Using our unique 100% difference auditing process, we find these errors and flag them for recovery. Incorrect claims impact not only the current claim but also the affordability of your plan. When it is time to renew your policy, the amount paid out is a key factor in determining your policy price. You do not want to pay for incorrect claims that falsely inflate the payout number.

So, back to our original question: How would you spend dollars that you suddenly weren’t spending on healthcare? With the money you save by including medical claims audits in your annual budget, you have options for your company. You might fund:

Additional training
Raises
Employee appreciation programs
Technology upgrades
THE LIST IS ENDLESS!

Remember, the provider of a healthcare plan (that’s YOU, the employer) is responsible for errors in medical payments. It is your fiduciary responsibility to ensure that claims are not overpaid and that your company’s bottom line stays healthy. We can help. Contact us now to talk about the cost and savings you can expect by performing a comprehensive audit so that you can include it in next year’s budget.

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Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through its 100% Difference model, recovering millions of dollars for clients’ bottom lines with uncompromising ethics and accuracy. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers, involving all national and most regional payers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for employers.

Healthcare Claims Mistakes Happen. Ignoring Them Could Cost You.

“Accountability is the glue that ties commitment to the result.”
Bob Proctor

Are you worried that if claims mistakes are found in your healthcare data set that you will be held responsible? We hear this a lot, but the fact is, NOT finding the mistakes and leaving them uncorrected is what makes individuals or companies look bad.

Human Resources departments should continually find ways to conserve costs and ensure HR is a bottom-line contributor for the company. After payroll, employee benefits are the next biggest expense for a company. Keeping expenses manageable while still providing robust benefits is a delicate balancing act. In today’s job market, benefits are a must. But just because your company will fund healthcare plans for employees, it doesn’t mean the expense shouldn’t be held in check. Fortunately, finding the mistakes in medical billing records is a straightforward way to show accountability and return money to the company. That returned money is then available for other worthy company initiatives.

What happens if you don’t find the claims mistakes?

According to a report in Becker’s Hospital Review, as many as 80% of medical bills contain errors. As healthcare costs continue to rise, so does the need for healthcare payers to reduce overspending from avoidable billing errors and improper claims reimbursement.

As an example, let’s say medical claims errors occur in 10% of claims filed. If a self-funded company has a third-party administrator (TPA) processing more than $1 million in claims payments each year, this could mean $100,000 of overpaid claims, at a minimum!

“Given the sheer volume of claims submitted each day, capturing and reconciling discrepancies based off of claims data alone isn’t just ineffective — it’s flat-out unviable. Payment integrity systems that review claims data against medical records are helping payers identify potential waste and abuse with greater accuracy than ever before, uncovering immediate and long-term cost savings opportunities.”[1]

This is what Healthcare Horizons does through our comprehensive audit process. With comprehensive audits, the full data set of paid claims are reviewed for errors in claims payments. Many companies who realize that they should be auditing annually are still relying on random sample audits. Random sample audits are better than nothing, but Healthcare Horizons believes they are not sufficient to ensure adequate cost containment measures are in place for the plan. We find that random sample audits rarely find significant overpayments or systemic errors. Are you willing to settle for 90% accuracy? (Read more about why you shouldn’t settle).

What do claims audits find?

The root cause of our audit findings usually involves one of 5 types of errors. Often, we find more than one of these errors has led to overpayment of medical claims.

Systemic error. These are errors that may have occurred when the plan was established and typically involve charges that repeat.
Manual one-off error. The most common mistake, this is usually due to human error when inputting information.
Lack of action on retroactive information changes. Reviews are frequently performed to determine patient eligibility for certain procedures or claims. If the changes in eligibility are not entered into the system, incorrect charges or reimbursement requests will be submitted. These inaccurate claims result in erroneous denials or payments when compensation should not have been made.
Discrepancies in plan interpretation. Since humans interpret plan requirements, incorrect payments can happen if there are differences of opinion about what the plan covers.
Provider billing errors. This error is also typically human error. Transposing just one number can cause medical claims to be incorrectly coded and paid.

Implementing tools, like audits, to find these errors shows a high level of ownership and responsibility to ensure the best management of employee and company dollars.

Finding claims mistakes isn’t about pointing the finger.

We have uncovered many examples of systemic errors in claims processing that could cost a company millions of dollars in potential lost payments. Our case studies page outlines some of the most egregious examples of overpayments. Our comprehensive audits not only find the errors and allow the company to recover these overpayments, but we then work with the company and their TPA to fix the ongoing issue that caused the overpayments from the onset.

With the new CAA (Consolidated Appropriates Act) in place, plan fiduciaries have new sign-off responsibilities beginning in December of 2022. Comprehensive audits are a tool to ensure HR leaders and C-Suite management feel comfortable that the systems in place for processing the large number of healthcare claims are accurate, and include a way to fix errors…including the fees you may not know existed. As the plan owner, you have the final responsibility for these costs. So, the question left to ask is: Would you rather find the mistakes in your healthcare claims data, or would you rather someone discover the error down the road when it is potentially too late to recover overpayments? You can be the hero. We help make sure you are protecting the financial integrity of your employer-provided and funded healthcare plan.

We will be at SHRM in New Orleans next month and would love to talk about the systems you have in place and how we can help with your financial bottom line. Stop by Booth #2870 for a giveaway and we will be happy to answer your audit questions!

Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through its 100% Difference model, recovering millions of dollars for clients’ bottom lines with uncompromising ethics and accuracy. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for employers.

[1] https://www.modernhealthcare.com/finance/identifying-addressing-common-medical-billing-errors-pre-post-payment

Equal Fiscal Protection for Your Company

Companies that self-fund their healthcare plans have a fiduciary duty to ensure that those plans are being administered properly – even if that administration is done by a third-party administrator (TPA).

Your company deserves the same fiscal protection from your TPA that the TPA provides to its fully insured clients. ERISA requires plan sponsors to file government reports, provide information to participants, protect plan assets, and deliver benefits to participants.[i] The only way to know that you are protecting assets and delivering benefits is by ensuring that your claims are being processed correctly.

TPA Fiscal Protection Pop Quiz

QUESTION: Would a TPA that fully funds a healthcare plan randomly choose which claims to audit?

ANSWER: NO! It is common sense that random sampling is not as effective at catching claim errors as a comprehensive audit. So why are too many companies accepting random sampling language in their service agreements with the payer? Allowing a TPA that manages claim payments of your plan (and doesn’t fund them with their own dollars) to only audit a few random claims is like letting the fox guard the henhouse.

QUESTION: What testing performance guarantees protect my company?

ANSWER: Not many. Performance guarantees are stacked against you if random sampling is used. It comes down to math.

Let’s say the guarantee is 98% accuracy in filed claims. Your company files 50,000 claims per year. Even if 1,000 of those claims are processed in error, the company meets its guarantee. HOWEVER, in random sampling, only 250 to 400 claims are usually analyzed. The likelihood that those few claims contain errors is a gamble the TPA is willing to make. Are you?

QUESTION: Our TPA found an error through random sampling, so the process is working, right?

ANSWER: Even a blind squirrel finds a nut every now and then. Finding errors and returning overpayments to your plan fund is the primary objective of any audit. However, if you don’t fix the source of the problem, you are likely to continue to lose money through systemic or repeatable errors. Comprehensive audits not only find the claim errors but will identify systemic issues that are causing continued mistakes.

QUESTION: Did your TPA tell you their audit language is standard and must stay in the agreement?

ANSWER: THIS IS NOT TRUE. It’s your plan, your money, your employees, your responsibility! Change the audit language to ensure the fiscal protection of your company’s bottom line, as well as the pocketbook of your employees.

The Fiscal Protection Bottom Line

If your service agreement only allows for limited TPA-provided audits, don’t sign it. In a random sample audit, the claim picked to be analyzed might be correct but be sandwiched between unexamined errors, costing your company thousands of dollars. Demand that language be included that gives you YOUR right to work with other companies to conduct comprehensive audits.

To put it succinctly, a TPA will most assuredly look at EVERYTHING if fully insuring a plan versus managing a self-funded plan. Your self-funding company deserves the same coverage they give themselves.

Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through its 100% Difference model, recovering millions of dollars for clients’ bottom lines with uncompromising ethics and accuracy. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers, involving all national and most regional payers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for employers.

[i] Tiaa.org

Analyzing healthcare budgets and finding errors with audits

Budgets and Healthcare Audits: A Smart Partnership

When you are preparing a company budget, are you including healthcare audits? Budgets and healthcare audits are both necessary pieces for fiduciary responsibility. Failure to audit could be a red flag that you haven’t protected the financial interests of your employees & employer.

budget and audits present money as gift — Healthcare audits return YOUR money back to your budget.

What’s at stake?

- Employers pay an average of 86% of healthcare premiums for single coverage and 72% for family coverage.
- Health insurance costs approximately $2.64 per hour for private industry workers.
- In 2020, the average annual premiums for employer-sponsored (self-insured) health insurance were $7,470 for individual plans and $21,342 for family coverage.

Source: SanaBenefits

Obviously, this is a significant portion of a company’s budget. Healthcare costs are expected to continue to rise, so company leaders must find cost savings while still providing competitive, quality care for their employees.

Protecting Employer and Employee

Simply, healthcare claims audits find errors. And if your company is providing healthcare, there are errors in your claims. Your healthcare budget, and your employees’ healthcare expenses, can be contained with regular audits.

In a successful comprehensive audit, you will recover overpayments and identify potential systemic issues causing the incorrect billing. Both are important.

Overpayment of Healthcare Claims

Recovering funds is the most important step for both employer and employee. If claims are overpaid, the employer will see more expenditures in individual claims, but also potentially be quoted for higher premiums at the next negotiation period.

For employees, claim overpayments can negatively impact employees’ deductibles and co-insurance payments. Look at the following example.

An employee had gall bladder surgery in an in-network surgery center. A primary and an assistant surgeon performed the surgery. Assistant surgeons are generally priced at 20% of the full schedule rate. However, this assistant surgeon was out-of-network and billed more than $20,000 for the surgery. Since the assistant surgeon was paid at full billed charges, the patient ended up paying more for their co-insurance than they would have paid if the assistant surgeon had been paid according to the applicable fee schedule. The employee did not have any other medical claims for the year, but unfortunately still reached their out-of-pocket maximum due to this claim processing error and was out more than $3,800.

Systemic Errors in Healthcare Billing

Systemic errors are different than data entry errors. With systemic errors, there is a process in place that is causing repeated errors in billing. Eliminating these root cause problems should reduce the number of claim errors you have in the future.

For example:

A facility may be unbundling charges that are meant to be billed as one item. Unbundling is when providers charge for line items individually instead of using a code that bundles charges. By unbundling the provider gets paid more than they should had the correct bundled code been used.

Have you met your fiduciary responsibilities by including audits in your company budget?

If the answer is no, contact us. “Health plans have a fiduciary responsibility to their members to make certain that the members’ claims are processed and paid correctly,” says Barry Silver, Healthcare Horizons Senior Vice President. “Otherwise, their employees could end up paying more money than they should on medical bills. The plans can engage external auditors to review the medical claims payments to assess if their claims process is functioning properly and that their claims are being paid as accurately as possible.”

Our unique audit process will help you return the maximum dollars to your bottom line. If your budget is already set for next year, an audit is still important because it will give you a strong comparison of your healthcare expenses so that you can strategically plan going forward. It really is never too late to take charge of your company’s healthcare expenses.

Healthcare Horizons is a leading expert in providing healthcare claims audit services, identifying overpaid or erroneous claims through its 100% Difference model, recovering millions of dollars for clients’ bottom lines with uncompromising ethics and accuracy. Since 1999, the Knoxville, Tennessee-based company has provided superior healthcare claims audits for some of the world’s largest self-insured employers, involving all national and most regional payers. We have successfully identified and facilitated the recovery of millions of dollars of overpaid claims for employers.

Thankful open enrollment is almost over? Now what?

Each year, self-insured employers pour a great deal of time and energy into creating the best benefit plan for their employees. They carefully review and compare benefit packages, consider costs and expectations, enroll employees, and communicate changes. If you have been part of the process, you may feel like it is time to put it all behind you and go eat turkey. Not so fast…

To ensure that your company has met its fiduciary responsibility to your stakeholders, consider a comprehensive audit of last year’s medical spend. A comprehensive audit uncovers any overpaid claims or claims paid in error, potentially adding thousands of dollars back to your bottom line. Additionally, a regular, comprehensive audit can uncover systemic errors, leading to future savings. Healthcare Horizons looks closer so you don’t have to, and we do it while respecting your TPA relationship. We will follow through on claims recovery until you are satisfied.

Regular healthcare claims audits ensure that you are protecting your financial interests while providing the best possible benefits and services to your employees.

The Difference is in Knowing. That’s something to be thankful for!

Visit Healthcare Horizons today to learn more, or contact us at hhadmin@healthcarehorizons.com to discuss a healthcare claims audit assessment.

Randy King is president of Healthcare Horizons Consulting Group, Inc., which has performed healthcare claims audits since 1999. Trusted partner. Uncompromising accuracy. Superior personal service. Recovering millions of dollars for some of the world’s largest employers.

The Last Days of Summer and Planning Ahead

Labor Day has come to symbolize the official end of summer, with family gatherings, final trips to the beach, and the wafting aroma of BBQ on the grill. It’s also a time to start thinking about fiscal planning for the next year.

Labor Day began as a yearly, national tribute to the contributions workers had made to the strength, prosperity, and well-being of our country. The first observance was celebrated in New York in 1882, followed by a festival for the recreation and amusement of the workers and their families. Summertime has a way of reminding us that friends and family are what truly matter in this life.

Relationships are important, and at Healthcare Horizons, we believe in people and relationships first. Our focus this Labor Day, and every day, is on you, those who help make you successful, and your company’s financial interest. As you look ahead to year-end planning activities such as closing financial books, budgeting and creating goals for the coming fiscal year, let us contribute to your bottom line in 2018.

Healthcare Horizons helps keep your healthcare costs in check. It is crucial that self-insured employers conduct annual healthcare claims audits because one of the unintended consequences of self-insuring is that claims payers have no financial incentive to control costs. Regular healthcare claims audits ensure that employers are:

Fulfilling their fiduciary responsibility
Not overpaying claims or paying claims in error
Identifying and eliminating systemic errors
Recovering overpayments within the TPA’s timing limitations, typically two years

We offer customized, flexible pricing options designed to meet your needs and accommodate your TPA requirements. Our fixed-fee pricing ensures you know exactly what your out-the-door audit cost will be. We also offer a risk-free, contingency pricing structure that is based on what we collect, not on the errors we identify.

Call or contact us today to get started on your fiscal planning for next year. We’ll do the work so you can sit back, relax, and enjoy the last days of summer.