Can Merged Companies Better Reduce Health Costs?
Each year in the United States, health care costs increase. It’s something we watch every day at TFG Partners as we conduct medical claim audits. Rising costs are a budget issue for businesses, the government, and all of us as individuals. Therefore, the search is always on for ways to reduce costs. In the past couple of years, combining health and pharmacy benefit administrators was heralded as a way to do it. Yet a survey of corporate benefits executives found that only 50-percent had confidence it would work. The rationale from the combined companies is that cost-savings result when fewer entities are trying to earn a profit.
If you manage a self-funded medical plan, costs are an item to bring up during negotiations with health insurance carriers that want to handle your claims processing. Our advice at TFG Partners is always to do what is best for your budget so long as it supports excellent delivery of care to your employee plan members. Then count on medical claim audit companies like us to help you be sure the promises are kept. Covered expenses and claim processing are notoriously complex, and it is easy for things to fall through the cracks. It’s one of the reasons we strongly advise clients to let us monitor claims continuously.
What to Do if You’re Being Overcharged?
The easiest way to take a health plan/claims processor to task for overcharging (failing to manage costs adequately) is to switch plans. But it is easier said than done because employees and their dependents who are your plan members push back against the inconvenience, possibility of losing access to their doctors, and uncertainty of a new carrier. Therefore, better managing the plan you already have is often the more attractive option. Accountability can be obtained by auditing on a regular basis, the right thing to do from a compliance perspective. However, when it comes to cost controlling cost, it is a bit like driving a car while looking through the rear-view mirror. To truly improve optimal benefit access for your members while minimizing unnecessary costs, it is recommended to leverage today’s technology and review the claims as they are incurred using what is called Continuous Monitoring. Continuous monitoring by auditing medical claims on a near real-time basis is an excellent management tool at your disposal. And in the end, your administrator will appreciate this approach as well as it improves service performance, reduces the number of expensive calls and appeals to the administrator from your members, avoids lengthy “haggling sessions” at the end of the plan year to make you whole, and in the end protects their business as you as a satisfied client will likely renew year after year. And during the year, your partnership strengthens as progress can be made much better when you discuss focused improvements while holding factual data in your hand, something much more constructive and powerful than quietly holding a grudge, losing confidence, or voicing general frustration and complaints without specific improvement options with your plan administrator. This only leads to you planning the next full-blown RFP to look at alternatives, and that is the last thing your administrator wants.
When a carrier and its people realize you are keeping an eye on claims administration and understand the details, the discussion takes on an entirely new dimension. For example, in the pharmacy benefit area, specific improvements can be targeted if discounts are missed, excessive volumes of name brands continue to be dispatched when lower-cost generics are available, or the PBM is missing targets due to problems created by the plan provisions. The health plan audits and monitoring we provide easily catch all these errors, and the improvements that are implemented as well as waste that can be recovered more than pays for our service. When you closely monitor a health plan/claims administrator, costs are always better managed, and the business relationship is smoother.
Health Insurance is a Massive Business: It Rivals Tech
Annual revenues for the five largest health and pharmacy benefit plans rival those of the leaders of the tech industry. It’s useful to note their size and scope in understanding the significance of health care costs for businesses and American society in general. It’s why the stakes are so high in anything related to health care spending. Medical claim audits and pharmacy claims reviews are an essential part of the equation. Whether it’s in an audit or continuous monitoring, they’re the best way to be sure you’re getting the maximum return on your company’s health care investment – and not overpaying for it.