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Dependent Eligibility Verification Audit

Louis Lawson

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Today I will discuss

The Reaso

ns

The Proce

ss

The Soluti

on

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Rising Healthcare Costs

2006

2007

2008

2009

2010

$0 $2,000 $4,000 $6,000 $8,000

Meijer-Health Care Costs

Per EE Per Year

Hewitt Associates, comp. Meijer and Hewitt: Partnering for Success-Appendix-Historical Healthcare Costs and Trends. Rep. Hewitt Associates, 2010. Print.Hobson, Katherine. "Is Your Spouse Really Your Spouse? A Dependent Audit Wants to Know - Health Blog - WSJ." WSJ Blogs - WSJ. June-July 2010. Web. 29 July 2010. Fuller, Thomas J. "RealLife HR Recommends Cost-Savings Tool: Dependent Eligibility Audit - Benefits & Compensation - HR Management US | GDS Publishing." HR Management | The Online Human Resources News Source HR Management | The Online Human Resources News Source | GDS Publishing. Web. 03 Aug. 2010. <http://www.hrmreport.com/article/RealLife-HR-Recommends-Cost-Savings-Tool-Dependent-Eligibility-Audit/>.

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Dependent Eligibility Audit?

Highly Structured Controlled Process

Helps lower health care spending

Mitigates Compliance/Fiduc

iary violations

HRAdvance - Benchmarking Case Studies." HRAdvance's Plan-Smart: The Standard in Eligibility Solutions. Web. 28 July 2010. <http://www.plan-smart.com/ppt/dea_results_stats.html>.

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• The success of this project was measured by:

The percentage of team members who verify the eligibility of their dependents

The percentage of team memnbers that are unable or unwilling to verify their dependents’ eligibility

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Reasons for the Dependent Eligibility Verification Audit:

Audit presents a two-fold solution

Confirm Eligible Dependents

Remove Ineligible dependents

HealthCare Expansion

Rising cost

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Meijer’s use of a dependent eligibility verification audit has enabled them to:

Ensure that current team members comply with health plan eligibility requirements.

Develop a process that allows them to avoid future large scale eligibility audits.

Executive Summary

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The Reaso

ns

The Proce

ss

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Strategy

Communication Process

• Targeted Letters• Introductory article in

Fastlane• Modifications of Mercer’s

communication suite

Pre-Audit

• Reminders in FastLane• Emails to team members

and leadership• Status updates through

Mercer

During

Audit

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Document Verification Process

Receive Verification Packet

Submit Valid Proof for dependents

Receive Completion Notification

Dependents are eligible

Submit invalid Proof for

dependents

Receive incomplete Notification TM receives

incomplete notice, given the opportunity to submit valid proof

Do not respondReceive Non responder

Notification

Dependents in question are

currently ineligible

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Escalated Issues

Mercer Customer Service Rep

Escalation Manager at Mercer

Louis Lawson at Meijer

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83%

0%2%

14%

Team Member Status

Completed In Progress Incomplete Not Started

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83%

14%2% 1% 0%

Dependent Status

Confirmed Eligible No DocumentsVerification Failed Removed by Team MemberIn Progress

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Cost SavingsReason Number of

DependentsAverage Cost of Dependent

Total Savings

Removed by Team Member

126 $2,100 $264,600

Verification Failed

332 $2,100 $697,200

No Documents 2974 $2100 TBD

Preliminary Total Savings (annual)

$961,800*

Preliminary Total Savings (Five-Year)

$4.8 million*

Hobson, Katherine. "Is Your Spouse Really Your Spouse? A Dependent Audit Wants to Know - Health Blog - WSJ." WSJ Blogs - WSJ. June-July 2010. Web. 29 July 2010.

"Dependent Eligibility Audits Impacted by Reform Law." SHRM Online - Society for Human Resource Management. Web. 02 Aug. 2010.

* Estimate, subject to change by audit’s conclusion.

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The Reaso

ns

The Proce

ss

The Soluti

on

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Moving Forward

Proof will be required for all enrollees.

• Team member has 60 days to provide proof.

• Team member will receive a notice at the midpoint between the enrollment of the dependent and the 60 day mark.

Enrollees will be dropped if proof is not submitted.

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Dependent Verification

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HCR Results

• As of July 26th

– 508 Dependents added– 340 have provided accurate proof– 21 have provided inaccurate proof

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With this process in place….Meijer is able to ensure that their records remain accurate, avoiding

the need to “clean house” with another large scale dependent

eligibility verification audit in the future.

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Thank You

Any Questions?