Third Party Administrator Claim Audit Report - wship

I. General InformationThe Washington State Health Insurance Pool (WSHIP) provides health benefits toapproximately 2,800 enrollees. Benefit Management Inc. (BMI) is the new contractedThird Party Administrator (TPA) that provided the claim administration for the periodaudited. BMI has 65 full-time employees; 12 of those employees are involved in theWSHIP program. For the onsite audit, BMI provided hard copies of the actual claims andexplanation of benefits. System access was also provided that allowed inquiry to systemnotes, accumulators, and eligibility information.BMI did not provide any documentation for pending items with the exception ofsome pre-certification information that had been received from Health Integrated via fax.Chris Clasen, Manager answered questions and provided additional documentationduring the onsite audit as well as follow-up documentation post onsite review.II.Scope of AuditIn preparation for the audit a total of 200 claims were selected from a claim datadump produced by BMI. Based on the sample size and selection pool, this audit carries a95% confidence level at 4% sample precision. The data included all claims processed byBMI from April 1, 2004 through September 30, 2004. The claims were randomly selectedby claim type (professional and facility) and payment category ($0 and up) to ensure anadequate audit sample. The majority of the claims selected for this audit were run-inclaims that had been originally received by the prior TPA.The Washington State Health Insurance Pool offers three health insurance plansto its enrollees. Plan 1 is a major medical plan with deductible options ranging from2