Selman & Company is a third-party administrator that handles a wide variety of insurance claims on behalf of many different insurance carriers. Due to the complex claims adjudication needs of each carrier Selman supports, no single flow diagram exists. However, there are several best practices that can be universally applied to all of the claims processes we administer. In this post, we invite you to peek inside the workings of the Selman claims machine.
1. Integrate IT Systems and Administrative Systems
Technology supports every point of customer interaction. A solid connection between the systems that handle administrative inquiries and the systems that handle claims processing improves coordination across multiple policies and reduces errors in billing. This can be accomplished through regular data feeds of critical data required to adjudicate claims or through integration using a web service. Our system is well-positioned to process Accident, Term and Whole Life, Cancer, Critical Illness, Hospital Income and Accident, Disability, Return of Premium and Medicare Supplement products, just to name a few.
While it's optimal to fully integrate the claims system with the administrative system, we also provide the flexibility to process claims where the policy is not billed and administered by systems within our purview. When it comes to our clients' needs, customization is the standard rule! Specifically, the ideal integration provides an efficient mechanism to check for multiple policies upon notification of death as well as calculation of return of premium (assuming a history is available to convert).
One of the essential technologies behind the claims process is the workflow and imaging solution we use to intake claim data. This is an additional measure we use to achieve a zero tolerance for lost documents and maintain close oversight of work in process. A complete audit trail is kept of every item within the workflow including the number of pending items for processing, the queues the items have routed through, the users that have processed the document, the specific actions that were taken, and the timing of those actions.
2. Track the Process Carefully
This is where the rubber meets the road. The process must roll along smoothly while staying inside the lines at all times.
Most claims begin in our call center. When a claim is reported, a customer service representative will complete a worksheet of required data in order for the claim processor to complete the package for the claimant or beneficiary. However, not every claim comes into our call center: Claims submitted through mail or fax are handled directly by claim processors. The claim processor sends the appropriate instructions, forms and documents, based on carrier requirements, to the claimant/beneficiary. Claim packets are issued within 5 business days.
Once returned to Selman & Company, the claim packet is logged for tracking and reconciliation purposes, completed with all other supporting documentation needed and then, either forwarded to the insurance carrier for payment, or it's fully processed internally.
Upon receipt of claim forms and supplemental materials, the claim examiner verifies completeness of the information and proof of loss in accordance with the insurance company’s policies and procedures. If additional information is needed or if missing, we will make two attempts at 30 days and 60 days after the initial submission. If the required items are not received after 90 days, the claim file is closed and imaged. A letter is sent to the claimant/beneficiary stating missing information was not received and no further action will be taken on the claim. The final step is to update the claim status in the tracking log.
It is standard procedure to confirm the 'paid to date' at the time of claim notification and then again at time of claim certification and preparation for payment. When Selman & Company is engaged to fully adjudicate claims, the system will also verify the 'paid to date' to the date of death because of the integrated design. We evidence our adherence to this step in the process by printing the insured record from the administrative system at the time of each review, and we maintain this with the archived claim file.
When Selman & Company is only providing claim preparation services, all claims are entered into our tracking database for ongoing management. This database captures key elements of the claim process such as original effective date, date of death/accident, date of claim notification, date claim packet issued, date of claim to carrier, claim status and claim payment (if any). Throughout the process, the database is updated with any changes to claim status. A monthly reconciliation is performed to ensure all pending records of Selman & Company mirror the records of the insurance company.
If it sounds like a pretty rigorous procedure where attention to detail matters--it is.
3. Customize The Outcome
Remember, when it comes to insurance claims processing, customization is the standard rule. This is especially true in establishing who has the authority to approve or deny claims. Authority levels vary, and are decided by the carrier.
Claim processing authority limits are set within the system, either by Examiner and/or Claim Type, which allows for variable limits for a single employee based on product. Auditing is systematically controlled and the audit rules are based on eligibility and pre-disbursement rules. Therefore, once the claim is selected for an audit, the claim payment or claim correspondence is not executed until the audit is performed. Once the audit is performed and the claim is approved, the disbursement of the payment/EOB or denial will be completed.
The system can be programmed to audit every overridden claim or only those equal to or less than a specified tolerance amount. Rules can be established so that after a specified number of claims have been denied or approved, the next claim is selected for audit, regardless of payment amount. Additional rules based on payment amount can be established, such as:
‘Every 25th claim with payment values between $1-1,000.00 will be audited and every claim with payment values greater than $250,000 will be audited.’
The specifics here are completely driven by the insurance client's requirements.
4. Report Regularly
Reports reveal trends, and allow Selman & Company as well as client business analysts to derive insights about the claims process. The claim system has a robust collection of standard reports that can be set to run automatically at certain time intervals (daily, weekly, monthly) or upon request. Custom reports or queries against the database are also easily administered.
Some of the standard reports that are reviewed on a regular basis include:
- Claims Summary Report by Status
- Claims by Processor and Status
- Claims Aging by Status Effective Date
- Claims Paid by Company
- Legal Queue
- Fraud Queue
- Audited Claims
- Claims Repetitive Payment
- Claims Adjustment Payment
Insurance claims processing isn't something any company can do, or do well. Mastering the nuance and complexity of claims requires significant IT investment, a meniacal attention to process, and laser focus on the client's requirements. And reporting closes the loop with clients while it simultaneously opens up a dialogue for improvement. Indeed, changing regulations, new products, and new technologies push us to constantly improve how we administer claims.
The claims processes we've highlighted here describe an expertise in technology, people, and process that Selman & Company has developed over many years. This well-tuned machine wasn't built in a day. If your company requires assistance with outsourcing its claims process, contact us today.