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March 1, 2018

Value Realized – Periodic Dependent Verification Still Successful

Business Situation & Client Profile:       

A regional healthcare system asked BMI to verify the eligibility of all 5,143 dependents enrolled in their health plans after several years had passed since their last dependent eligibility audit.

 

Solution:

BMI customized an audit plan to meet the following objectives:

  • Communicate the purpose of the audit, deadlines, compliance requirements, etc. to all employees with one or more dependents.
  • Examine 100% of all eligibility records to identify enrolled employees with one or more dependents.
  • Provide a customer service department with toll-free phone lines and bilingual staff.
  • Compare plan eligibility requirements with documentation submitted.
  • Securely collect and retain all verification documentation used to confirm eligibility.
  • Identify all dependents currently enrolled who do not meet eligibility criteria.
  • Report findings weekly and provide a final executive summary of results.

 

Audit Finding:

  • Over 96% of audit participants completed the audit.
  • 146 dependents (2.84% of total) failed to meet plan eligibility requirements.
  • Reasons for ineligibility included voluntary removal, unreported divorces, or dependents where legal guardianship was not established as required by the plan.

 

Audit Outcome:

The client terminated coverage for the 146 dependents who were identified by the audit to be ineligible.  Additionally, coverage was terminated for another 128 dependents who did not respond completely prior to the audit’s deadline despite multiple communications.

 

First Year Savings Calculations

Average Annual Cost per Dependent:                                   $3,500
Estimated Annual Savings:                                   $959,000
Return on Investment:                                   1,885%

Click here to read more about dependent eligibility audits.