The world of claims is busy. Sometimes, too busy. In a process with so many moving parts, it’s conceivable that things get lost in the cogs or slip through the cracks of the claims adjudication machine. The truth is, it’s not uncommon for providers to submit duplicate claims to administrators — and it’s not uncommon for administrators to pay the same claim twice. These kinds of things shouldn’t be the norm, but they do happen every day and leave you wondering what it means for your bottom line.
Types of duplicates
Basically, there are two types of duplicates — exact and possible. As the name implies, an exact duplicate is the same claim submitted twice. An example might be a claim submitted through insurance for a patient that had a colonoscopy. The physician’s office submitted the claim but after 30 days the payment had not been received, so they submitted a second invoice for the same service. In general, most administrators’ systems would recognize this as an exact duplicate and automatically reject or deny the duplicate claim, but sometimes they slip through and you or your employees end up paying for the same service twice.
The second type of duplicate claim is a possible duplicate. These have one or two key data elements changed or added, such as a charge amount or an additional service line. An example of this could be a charge for an in-office procedure. Originally, the claim was submitted by the physician as a standard office visit. Later, the office realized that the supplies and medications used in the minor procedure were not billed to the insurance company, so they re-submit the claim with the corrected amount. These types of duplicates are not automatically rejected or denied by the administrator's processing system, but rather put in a pending status for manual review. Once it reaches this status, it’s up to the claims processor to determine whether or not the claim was a duplicate. In this example, the claim adjudicator might not have realized that there were two claims for this procedure, looking solely at the amount difference, and accepted both claims. The company then ends up paying twice.
Impact of duplicates on your bottom line
Duplicates significantly impact your bottom line by increasing your out-of-pocket expenses and costing you valuable time and resources to correct errors. During a recent audit, CTI found a claim processor that received a possible duplicate alert while processing a claim. The processor ignored it, and instead overrode the notification to pay the claim. This resulted in a second $1,200 payment. Over the course of the same audit, 40% of the duplicate claims tested for our client resulted in double payments. Given this finding, it’s easy to see how this type of error can add up quickly. Just a handful of these errors could have cost the company thousands of dollars. That’s your money they’re leaving on the table.
The CTI difference
We use five different screenings to identify possible duplicate claims paid by administrators. Through our screening and testing process for the client described above, we identified a potential of $175,000 in overpaid claims due to duplicate payments made to providers. Every administrator pays duplicate claims to varying degrees. The question you should be asking yourself is: how many dollars in duplicate claims is your administrator paying on behalf of your self-funded group? Contact us to find out.
It’s a fact...every administrator makes mistakes. The five basic errors with which we find significant discrepancies discussed in this series will include: plan limitations, duplicate payments, exclusions, incorrect coordination of benefits and incorrect copayments. Be sure to check back for next week’s blog, to see other ways you can stop the leaks in the administration of your self-funded plan.
