Healthcare Billing: Uncovering Costly Inconsistencies Negatively Impacting Businesses ROI

In today’s complex landscape of healthcare benefits, small and medium-sized businesses face a financial challenge that often goes unnoticed. Healthcare costs seem to increase each year while the depth and breadth of coverage wanes. Furthermore, without the proper attention to administrative details, billing errors and accounts not properly scrutinized on a regular basis can be prone to paying for employees that are no longer on the payroll or perhaps changed their plans – attributing higher monthly healthcare expenses.

Let’s delve into the common pitfalls that contribute to this financial drain for businesses of all sizes.

Common Administrative Errors in Healthcare Billing 

As an advisor to thousands of companies and non-profit organizations in different industries, the following unbeknownst administrative errors in healthcare processing are responsible for inflating monthly costs:

Outdated Headcount

The first issue in healthcare billing lies in the failure to update employee headcounts accurately. Even after an individual has moved on from a company, they may still be included in the healthcare roster, leading to unnecessary charges. Regularly reviewing and updating the employee headcount is crucial to prevent oversights like these.

Status Adjustments

Another significant area where businesses may be losing money is the failure to adjust employee statuses. Failure to modify an employee’s benefits status, such as transitioning from a family plan to a less expensive option like an individual or spouse plan, can result in overpayment. Businesses need to ensure that they are accurately reflecting employees’ current benefit needs to avoid unnecessary expenses and continually increasing healthcare billing costs.

Plan Changes Oversight

Changes to benefits plans, including dental coverage, often go unaddressed during the administrative process. This oversight can lead to businesses paying for more expensive plans than necessary. Employers must vigilantly monitor and adjust benefit plans to align with the actual needs of their workforce.

Carrier Administrative Errors

Mistakes made by healthcare carriers during administrative processes can contribute to overpayment. These unchecked errors, if not identified and corrected, can result in businesses paying for incorrect headcounts and plans. Regularly communicating with carriers and auditing invoices can help mitigate these issues.

Based on having extensive experience in the industry, on average, at least three percent of a company’s employee headcount remains in the monthly healthcare expenses due to these errors. This oversight can cost businesses tens of thousands of dollars on a yearly basis.

While these challenges are widespread across different industries and organizations of all sizes, it’s important for businesses to understand that solutions exist beyond any specific benefits and HR solutions provider. Attentiveness in administrative processes, conducting regular audits, and having ongoing communication with healthcare carriers are essential practices for all businesses.

By addressing these administrative errors proactively, businesses can save a significant amount of dollars annually.

 

About the Author

Steve Rosenthal is one of the most widely recognized leaders in the employee benefits and human resource industry. Before becoming CEO of Triton Benefits and HR Solutions, Rosenthal was the CEO and pioneer of CheckPoint HR. Rosenthal previously served as Chairman of EPIX of what became under his leadership, one of the largest human resources outsourcing companies in the country. Steve began his career at Automatic Data Processing as an intern and later became a District Manager. Steve graduated from Fairleigh Dickenson University and earned a Bachelor of Science Degree in Management.

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