Monitoring the Program

Claims - Risk Management Systems - Record-Keeping - Compliance

Monitoring a Program is an essential part of managing a self-insured plan. It will help the self-insurer evaluate the effectiveness of the program, predict future costs with a degree of accuracy and also make changes to the plan as necessary. The following areas require special attention:

1. Claims

It is essential to have an administrator who has experience in the business and who is able to evaluate claims, negotiate with providers and Managed Care Organisations and to compile claims reports to the company. A self-insurer has a duty to audit its administrator's records on a regular basis as part of the general ongoing monitoring process.

2. Risk Management System

Having an accurate system of claims reporting which will enable the self-insurer to monitor its losses as well as to provide reports to the stop-loss insurer. It will also allow the self-insurer to make any amendments to the plan that might be required as a result of higher than anticipated claims arising from any one area.

3. Record-Keeping and Compliance

Record-keeping requirements fall into four major areas:

(i) Participant Records

Listings of plan participants should be maintained along with the history of coverage for each person as well as any information applicable to that person.

(ii) Claims

Individual claims files for each claimant should be kept along with separate files for subrogation and stop-loss recoveries.

(iii) General Record-Keeping

The plan administrator should have a correspondence file for each plan participant, telephone calls should be logged and all records kept for a period of 6 years (or as required by state regulation).

(iv) Compliance

Self-Insurers need to be sure that they are compliant with all Federal, IRS and State reporting requirements.

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