The intersection between HR strategy and HR technology

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A Technological Approach to Claims Audit

Donald Glade Avatar

The last two weeks I wrote about the ineffectiveness of traditional claims audit and the inherent conflict of interest some companies face when they perform such audits.  This week I’d like to introduce a company that brings a different approach to the industry: HR Best Practices.

HR Best Practices was founded by Howard Gerver five or six years ago.  I first met Howie 3 years ago at the 2003 HRO World Conference.  From the beginning, I could tell he was one of those people who just plain “get it”.  Since then I’ve found out more about his company and approach to health care claims audit.  I believe it’s unique.  If anyone reading this knows of other companies taking a similar approach, I’d love to know about them.

Essentially, HR Best Practices employs proprietary financial management and reconciliation tools to perform 100% audit of claims for three primary purposes:

  • Cost Recovery
  • Cost Containment
  • Cost Avoidance

For Howie, claims audit is ROI driven.  In fact, depending on the situation, I’ve seen HR Best Practices offer something I haven’t seen anywhere else in the industry: an ROI guarantee.  The flexibility of the approach makes it applicable to all types of claims data. The audits can be geared towards areas such as point-in-time eligibility, dependent audit, coordination of benefits, subrogation, disease management, cost benchmarking, etc.

There are a couple of White Papers available on thier Website here and here which give some really good information and further insight on the approach and application of the technology.

As I look at it, I definitely believe it is the approach of the future, making the traditional claims audit obsolete.  I assume there are other companies taking this approach, but haven’t run across them yet.  As I said earlier, if there are others offering this comprehensive approach, let us know. 

For now, it seems a no-brainer that this is the way to go to get a guaranteed return on investment and demonstrable cost recovery, containment and avoidance as a result.

About the authorDonald Glade is President and Founder of Sourcing Analytics, Inc., an independent consulting firm specializing in helping companies optimize their HR / benefits / payroll service partnerships through relationship management, financial analysis, and process improvement.

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4 responses to “A Technological Approach to Claims Audit”

  1. Howard Gerver Avatar

    Some of you may be surprised that we offer a 100% ROI guarantee, particularly in the context of a healthcare claims and eligibility audit. If it sounds too good to be true, let me explain, but first ask yourself the following question “Do I have 100% confidence that our eligibility data is insynchronization with our enrollment and medical/Rx claims data?” If you answered “no” the next question to ask is “What percentage confidence do I have?” Let’s assume it’s 97%. That means there’s a 3% error rate. For a plan spending $50,000,000 annually on health insurance, that translates into a $1,500,000 leak. For a business operating on a 5% profit margin, that translates into $30,000,000 in revenue equivalents. Now that I have your attention, let’s go back to our ROI guarantee.

    We can offer this with confidence because we too know from experience, that eligibility, enrollment and claims data do not flow in a perfect world. We perform over 20 different eligibility related tests to identify, quantify and monetize this leakage. Our audit environment has evolved over 5 years and interfaces with all the named HR systems and insurance companies. At the end of the day, we always find something that is material. That is why we offer a 100% ROI guarantee.

  2. Romain Avatar

    I feel uncomfortable about the post and the reply. I read this blog everyday. For me it is the only good blog on HR technology & outsourcing. For what its worth to you Dubs, this post and the reply demonstrate marketing/commercial intentions ; (

    This is not the place.

  3. Dubs Avatar

    Romain: First, thanks for your continued readership. Your input on this and any number of other discussions is really what makes this site interesting. Second, It’s always been the intention of systematicHR to provide non-biased and non-commercial opinions about trends, strategies and vendors in the HR space. If a vendor wants to respond, there has never been a case that I’ve edited the response other than for privacy reasons. However, your point is well taken and Donald and I will discuss our approach to discussing vendors.

    That said, The underlying message of the article is interesting. Similar to what I’ve been pushing for months about getting vendors to act upon their SLA’s, this is a form of SLA I suppose – but from a consultant’s viewpoint rather than an outsourcer’s. I’ve always been a proponent of sensible SLA’s that work for both the vendor and the buyer. Most good consultants always provide value to their customers. Skilled buyers know what to look for and understand the cost/benefit of the relationship. Unfortunately, some/many buyers are cost driven, spurring the formulation of this type of marketing. This speaks volumes about the sales atmosphere in the consulting marketplace.

    But then again – we haven’t talked at all about the technology. maybe another day…


  4. […] Last week’s post highlighted a company doing just that.  This blog, I believe, should be a place people can come to learn about trends in the market, services being provided, technologies being developed, and yes, vendors providing the services.  This is why last week’s post highlighted a specific company which is demonstrating “the intersection between HR Strategy and HR Technology.”  […]