Implementation Audit Prevents Costly Healthcare Plan Setup Errors
Business Situation
This communications sector client, with 3,500 employees approached BMI Audit Services to conduct an implementation audit after a segment of the company was carved out and transitioned to a new third-party administrator (TPA) for their healthcare plan. The primary objective was to confirm that the TPA system setup was correctly aligned with each plan’s stated benefits and Summary Plan Description (SPD).
Solution
After reviewing all applicable plan documentation, BMI auditors selected and customized over 800 test claims across the client’s three health plans. These claims simulated a variety of real-life scenarios, including limitations, prior authorizations, exclusions, deductibles, and custom benefit structures. Accuracy testing was conducted remotely in collaboration with the TPA to assess whether the TPA’s implementation of the plan setup reflected intended benefits.
Audit Findings
The healthcare implementation audit identified 27 discrepancies between the documented benefit design and the way the TPA had configured the system. Examples of misalignment included:
Deductibles and coinsurance not applied correctly to out-of-pocket maximums
Covered benefits incorrectly programmed to be denied
In-network virtual visits paid at 100%, bypassing copay and deductible rules
Visit limitation accumulators not functioning as intended
Penalties not applied for services delivered without required prior authorization
Audit Outcome
By conducting this independent implementation audit before live claims processing, the client was able to proactively detect and correct system misconfigurations, helping to avoid future claims processing errors, overpayments, and member confusion.
The findings also gave the client the opportunity to clarify benefit intent and direct the TPA to reconfigure system logic accordingly. This ensured more accurate healthcare plan administration and a smoother experience for plan members.