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The Overpayment Problem:

Medical claim overcharges were exploited by the Centers for Medicare & Medicaid Services (CMS) program called RAC (Recovery Audit Contractor) to recover improper charges after payment several years ago. RAC succeeds in collecting more than $2B in improper Medicare payments to providers (hospitals and physicians) each year.

This was the genesis of our ARMOR service in identifying errors that cause overpayments pre-payment for payers of self-funded healthcare. The CMS reports on the National Error Rate every year. That report states the National Error Rate for medical claim errors is in the range from 3.7% to 10.1%. The fact that 96% of medical claim errors are overpayments created the need for pre-payment overpayment protection.

The Overpayment Solutions:

ARMOR and CCAR are the cost containment solutions to your overcharges.

Prospective Approach for TPA administrated plans:

Our ARMOR service intercepts 100% of all submitted medical claims pre-adjudication, identifies medical coding errors, and then transmits all medical coding errors found to the Third Party Administrator (TPA). The TPA then can deny the claim line in error which in-turn stops overcharges by the provider and reduces the total healthcare cost. ARMOR reduces medical spend from 2% to 6% on average.

Retrospective Approach for ASO administrated plans:

CCAR is a three audit approach utilizing 100% of your prior 24 months paid claims.

This process is referred to as CCAR or Comprehensive Claims Audit Reporting combines the below three different audits to be done in synchronization:

  1. Traditional Plan Audit (Benefits audit)
  2. Correct Coding Audit (Medical coding review of 100% paid claims)
  3. Anomaly Audit (Identify claim irregularities that are not visible or easily found)

The ROI in our process is higher than a traditional audit as the Correct Coding Analysis and Anomaly Analysis finds greater savings opportunities than the traditional standalone plan audit.