Dependent Verification Saves Labor Union Over $6 Million

Business Situation & Client Profile

A major labor union health plan suspected ineligible dependents were enrolled due to unreported divorces and other disqualifying relationships. To address this, union trustees partnered with BMI to conduct a thorough dependent eligibility audit covering 9,891 enrolled dependents.

Solution

BMI developed a custom verification program to ensure compliance and reduce unnecessary healthcare costs. The solution included:

  • Clear Communication – Informed members of requirements, deadlines, and compliance steps.

  • Dedicated Customer Support – Toll-free assistance with bilingual representatives.

  • Document Verification – Cross-checked submitted documents against eligibility criteria.

  • Comprehensive Audit – Identified ineligible dependents and securely collected all verification data.

  • Detailed Reporting – Delivered findings and a summary of results to union trustees.

Audit Findings

  • 1,271 dependents (12.85%) failed to meet eligibility requirements or did not provide verification.

  • Reasons for ineligibility: unreported divorces, former stepchildren, and voluntary removal.

Audit Outcome

Coverage was terminated for 1,271 dependents. By removing ineligible dependents, the labor union achieved significant cost savings:

First-Year Savings Calculations
Average Annual Cost per Dependent: $5,000
Calculated Annual Savings from Dependents Removed: $6,355,000
Return on Investment (ROI): 8,765%

By partnering with BMI for dependent eligibility verification, this labor union successfully eliminated unnecessary healthcare costs, improving plan sustainability and financial health.

Dependent EligibilityRobert Temples