Services | Casualty Claim Audit & Best Practices Consulting

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Casualty Claim Audit & Best Practices Consulting

We offer two levels of service, starting with the review of individual claim files or groups of files. Examples of recent projects include:

  1. TPA performance reivew for a self-insurance fund that provides workers compensation and automobile, general and police liability insurance to 18 New Jersey municipalities.
  2. Triennial property/casualty TPA reviews for state-wide public housing authorities in compliance with HUD regulations.
  3. Fraud audit of the administrator and TPA of a self-insurance pool.
  4. Process-mapping and best practices review of the claim department of a regional insurance company.
  5. Prompt-payment audit (of health insurance claims) for the State of New Jersey.
  6. Workers compensation case reserve adequacy testing for an employer.
  7. Class-action case claim file review in connection with an M&A due diligence review.

Claim Audit Work Plan

Coverage, liability, damages, supervision and disposition are the key criteria we apply to each claim file we review. A typical work plan entails the following activities:

  1. Discuss with you the objectives, types of claims, timing and deliverables of the audit.
  2. Gain an understanding of the claim management information systems capability and management reports available.
  3. Select a sample of files to be reviewed.
  4. Review the adjusters' notes, interview notes taken by claim investigators, independent medical examiners' reports, status reports from defense attorneys, surveillance reports and other documwnts on file.
  5. Discuss selected files and issues with the adjusters/supervisors.
  6. Triage claims into categories such as significantly under-reserved, over-reserved and adedquate but worthy of close monitoring and possible future reserve strengthening.

 

Best Claim Practices Review

The focus of a Best Practices Review is the claim management process and what can be done to achieve improvement.

Additional Steps in Best Claim Practices Review Plan

  1. Examination of the claim organization, mission statement and compliance with departmental policies, procedures and claims handling manuals.
  2. Compilation and analysis of aggregate data, such as the inventory of open claims, case reserve changes, claim closure rates and allocated claim expense ratios.
  3. Review of the claim services contract, policies and procedures, job descriptions, staff qualifications and licensing.
  4. More one-on-one interviews of senior management, superviosrs and staff adjusters.
  5. Process-mapping, flow-diagramming and facilitated group brain-storming discussions.
  6. Tabulating adjuster case loads, work flows and assignments of cases based on skills and experience.
  7. Compilation of industry/peer group standards of performance and claim cost outcome data.
  8. Assistance in implementing recommended quality controls, claim best practices and action plans.

Benefits of our Claim Audit Services

  • Case reserve adequacy
  • Control over medical, litigation and other expenses
  • Identification of emerging loss patterns
  • Techniques to achieve lower claim cost outcomes in the future
  • Objective evaluation of the performance of your internal and external claim management programs
  • Avoidance of errors and omissions, fines and penalties
  • Evidence and expert witness in arbitration, mediations and trials
  • Greater customer satisfaction
  • Buy-in by staff to achieve improvement

 

Analysis, Strategy and Advice = Solution

Problem » A self-insurance pool established six years ago had never had the performance of its TPA reviewed. The scope of this project included over 20 person-days of on-site review of 250 workers compensation and liability claims.

Solution » Our comprehensive report provided the commissioners comfort that the TPA was providing an overall satisfactory level of claim managment services. It also highlighted a small number of volatile under-reserved claim files. We recommended techniques to improve performance in reporting, expense control, quality and disposition strategies.