Management theory may say that repetition leads to efficiency, but specificity is the key to success with medical claim audits. Each plan needs to be complicated in its list of covered services and the rates it will pay. Any auditor that takes a one-size-fits-all approach to audit claims is bound to miss meaningful opportunities to catch errors. The rate of claim processing mistakes is often at around three percent. But for large plans with a high claim volume, even a tiny rate can add to significant sums of money. It's why claim audits are in increasingly wider use for management oversight.

How are today's audits different? Most audits today review every claim paid. These total reviews are far more accurate than previous random sampling. It's all thanks to software advances that make the electronic portion of an audit more complete and involve less human intervention. Configuring software to each plan's claims is where the auditor's expertise comes in. It improves when people with experience in claim processing, ideally including time spent at large health plans, do the setup. Their knowledge of the finer points of claim processing and payments enables them to zero in on more crucial areas. 

Duplicate charges or overbilling some services are two more significant problems. Some overcharges also result from sloppy testing in which tests that supersede each other are ordered together. When a test reports results that are already understood from a previous test, they do not help patients (plan members) and drive up costs needlessly. The best auditors are on the lookout for such cases when they review medical; claims payments. Another significant opportunity is systemic errors that repeat. If left undetected, they can pile up over time and cost many thousands.

When auditing pharmacy plans which makes sense to do alongside health plans, flagging name brand prescriptions dispensed instead of generics is crucial. Some slip through the cracks even with clear formularies, and the more they can be minimized, the better. Member service improves, and costs are better managed when audits keep claim payments on track. They've become an important management tool and are now more than compliance tools conducted by professional auditors.