Most plan sponsors don’t think about audits when negotiating or renegotiating an ASO Agreement with their third party administrator. However, taking the time to ensure that your audit rights are protected is a wise move. Doing so will save time and lead to a more positive audit experience when the time comes to conduct your audit.
When negotiating your ASO Agreement, here are the top 11 things that you can do to ensure that you maintain a strong right to audit your plan:
6. Don’t allow restrictions on the type of audit you can conduct, how you compensate the auditor or who can conduct the audit. They are the ones being audited and they should have little control over these internal decisions that you make.
7. Have a process defined that is in your best interest or that is balanced. You don’t have to accept their “External Audit Policy” as it may be wildly in their favor – not yours. You should require that any components of their policy that would restrict the scope be embedded in your ASO agreement. Otherwise, you will be subject to a potentially changing policy that is designed to be solely in their favor.
8. If you pass the fiduciary responsibility in determining which claims qualify for payment to your administrator, keep in mind that they have a legal obligation to put your interests first – even if it is not in their best interests.
9. Ensure that there are no restrictions regarding your right to access all data and information use to process your claims. This should include both hardcopy materials as well as comprehensive electronic data. You should also consider insisting that the data be accurate. This may seem obvious, but it is worth specifying.
10. Avoid giving the administrator the exclusive right to handle overpayment recoveries. Your auditor may be more effective and be properly incented to produce more beneficial and timely results. You may also want to retain the ability to use an alternative recovery method if the administers recovery results are insufficient.
11. Make sure that if you are restricted to a specific sample size, that there is a clear process to expand the scope of the audit in certain situations. Systemic and systematic problems may be represented by only a few samples claims, but actually occur on a much broader basis. For example, if you are paying primary instead of secondary for someone on Medicare, there are likely to be many other claims in the same situation, not all of which will be in your claim sample.
