Dependent eligibility Audits

An important tool for effectively identifying and removing ineligible dependents from an employer’s self-funded health plan.

Step 1: Amnesty Period:

An Amnesty Period involves a time period in which employees are requested to self-report any dependents that are enrolled in their employer’s health plan who are not meeting the plan’s eligibility requirements. This voluntary self-reporting of ineligible dependents typically involves a time period in which there will be no financial consequences for employees who self-report their ineligible dependents relative to past paid claims.

Step 2.  Data Collection and Customized Analysis:

HDM requests and obtains an employee/dependent eligibility data file containing detailed enrollment records of all employees who currently have dependents enrolled. HDM imports and analyzes eligibility using customized applications developed by HDM.  HDM manipulates the data and categorizes dependents based on various parameters in order to tailor document request letters. We send document requests to all employees with enrolled dependents or a subset of employees. We then share detailed information regarding the outcome of the analysis in order to provide a sense of possible audit outcomes and to quantify potential candidates for focused analysis. 

Step 3.  Documentation Collection and Eligibility Confirmation:

HDM prepares the document request letters that are sent to employees. Employee responses and all related documents will be sent from each employee to HDM. We then monitor responses, send a follow-up letter to non-respondents, and review all submitted documents in order to identify those not meeting the plan’s requirements and to confirm those who are truly eligible.

Step 4.  Collections:

Employer determines if claims payments or premiums will be collected from employees.