Health plan auditing: 100-percent-of-claims vs. random-sample audits
by George P. Sillup, Ronald K. Klimberg
International Journal of Electronic Healthcare (IJEH), Vol. 6, No. 1, 2011

Abstract: The objective of this study was to examine the relative efficacy of two different methodologies for auditing self-funded medical claim expenses: 100-percent-of-claims auditing versus random-sampling auditing. Multiple data sets of claim errors or 'exceptions' from two Fortune-100 corporations were analysed and compared to 100 simulated audits of 300- and 400-claim random samples. Random-sample simulations failed to identify a significant number and amount of the errors that ranged from $200,000 to $750,000. These results suggest that health plan expenses of corporations could be significantly reduced if they audited 100% of claims and embraced a zero-defect approach.

Online publication date: Mon, 14-Mar-2011

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