Why Conduct a Dependent Audit?
Are ineligible dependents driving up costs for your organization’s health plan?
You won’t know unless you perform a dependent eligibility audit, in which you verify that all dependents identified by an employee to participate in a plan are actually eligible to receive those benefits.
Industry research suggests that 5-12% of the dependents on any given employee benefits plan may not actually be eligible for the benefit program. Removing those ineligible dependents can help you:
- Reduce Costs without changing the benefit plan structure.
- Improve Compliance with laws such as:
- ERISA, which requires that plan dollars are used for the sole benefit of employees and their eligible dependents.
- Section 125 of the IRC, which requires that the pre-tax treatment of benefit plan contributions apply only to those participants (employees and dependents) who are eligible for the plan.
- Sarbanes Oxley – Section 302, which requires companies to adopt and maintain internal controls that include policies and procedures for “prevention or timely detection of unauthorized acquisition, use or disposition of the [company's] assets” that could materially affect financial statements.
- PPACA, which expanded the definition of eligible dependents to Age 26 for affected plans.
Why Winston?Performing an effective dependent eligibility audit will require your employees to submit documentation that they may consider sensitive: birth certificates, tax forms, qualified support orders, and the like. Using an independent, third party will help maintain an arm’s length relationship between the employer and employee during this delicate process.
Winston Benefits offers a unique approach to dependent eligibility audits. Our employee-centric method has been proven to:
- Ensure that only dependents receive healthcare benefits.
- Produce results that are easily measured and generate an exceptional ROI.
- Complement existing and future strategies to contain healthcare costs.
Contact Us to find out how a member of our Dependent Audit Team can help you realize saving on your plan today! Or call an Audit Team member at 212.334.1000.