Supplier Management

Aspects of the benefit program that should be managed:

• Competitive cost advantage (long-term cost containment).
• Contribution to the corporate culture through employee understanding and appreciation.
• Affordability (short-term cost containment).
• Compliance with legislation (Employment Standards, Human Rights etc.).

Medical and Dental:

• Hyperinflation due to cost shifting, aging workforce, and price increases.
• Employee dissatisfied with claim payment.
• Required medication or service not covered.
• Claim declined because it was submitted too late.
• Perceived breach of confidential medical information.

Participation:

• Letters of offer inaccurately describe benefits.
• Letters of offer describe benefits too specifically.
• Confusing eligibility dates (new, rehired, changes in hours).
• Inconstancy between insurance policies and HR policies.
• Letters of termination extend benefits inaccurately or without approval.
• Conversion of life insurance at termination or age 65 not documented.

Income Security

• Short-term disability plan abused.
• Performance problem evolves into a disability claim just before termination.
• Disability wording too narrow to facilitate rehabilitation.
• Life insurance waiver of premium not applied for.

 

Active Audit Strategies - Group Life & Health Insurance

Claim Payments
Review a detailed claims listing to ensure that claims are paid according to the schedule of benefits.

Tax Payments
Review the invoices to make sure that the provincial sales tax was remitted correctly and applied properly to adjustments.

Review the annual financial statement to ensure it uses an appropriate treatment of taxes for refunds or deficit recovery.

Reconcile Financial Statement
Compare the detailed claims listing and monthly invoice to the totals in the renewal report and financial statement.

Eligibility
Review a list of participating members to ensure that everyone that should be included is and only those eligible are participating.

Claim Adjudication
Scrutinize the documentation for a sample of the various claims to ensure adequate evidence is obtained before claims are paid.

Risk Management
Review the documentation concerning reported and potential:

• death claims
• disability claims
• waiver of life premiums
• extension of benefits