Size Doesn’t Matter When Verifying Dependent Eligibility

Business Situation & Client Profile

A small manufacturer and exporter of recycled materials contacted BMI to verify the eligibility of 84 enrolled dependents on the group’s health plans.

Solution

BMI customized a recurring audit plan to meet the following objectives:

  • Communicate the purpose of the audit, deadlines, and compliance requirements, to 36 employees and their 84 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

  • 100% of employees responded to the verification request.

  • 12.5% of dependents determined to be ineligible

  • Reasons for ineligibility included divorces, former stepchildren and former domestic partners not covered by the plan.

Audit Outcome

The client terminated coverage for 10 dependents who were identified to be ineligible or who failed to verify eligibility prior to the submission deadline.

First Year Savings Calculations

Average Annual Cost per Dependent: $5,000

Calculated Annual Savings from Dependents Removed: $50,000

Return on Investment: 1,010%

Dependent EligibilityRobert Temples