Eligibility Verification Achieves Over $150k in Savings

Business Situation & Client Profile

Looking to help combat rising health insurance costs, a construction company with 159 employees approached BMI to confirm that only eligible dependent children and spouses were enrolled in the company’s health plans.

Solution

BMI customized an audit plan to meet the following objectives:

  • Communicate the purpose of the audit, deadlines, compliance requirements, etc. to 159 employees with 338 enrolled dependents.

  • Provide a customer service department with toll-free phone lines and bilingual staff.

  • Compare plan eligibility requirements with documentation submitted.

  • Identify all dependents currently enrolled who do not meet eligibility criteria.

  • Securely collect and retain all verification documentation.

  • Report findings weekly and provide a final executive summary of results.

Audit Findings

  • 18 dependents (5% of total) failed to meet plan eligibility requirements.

  • Reasons for ineligibility included unreported divorces, voluntary requests to remove coverage and dependents eligible for coverage thrown their own employer but did not enroll.

Audit Outcome

The client terminated coverage for 18 dependents who were identified by the audit to be ineligible. Coverage was also terminated for 14 additional dependents who failed to verify eligibility despite multiple communications prior to the audit’s submission deadline.

First Year Savings Calculations
Average Annual Cost per Dependent: $5,000
Calculated Annual Savings from Dependents Removed: $160,000
Return on Investment: 1,720%

Dependent EligibilityRobert Temples