What? Me Divorced?
U-M audits insurance eligibility.
by Sally Mitani
From the May, 2010 issue
This year, the U-M will pay on average about $6,800 to provide health care coverage for an employee with dependents. So for the first time, the university has hired a company to conduct a full "dependent benefits eligibility audit." Indiana firm Chapman Kelly sent letters to all 19,000 U-M employees who claim dependents, asking them to provide proof of eligibility.
David Reid, U-M's director of HR communications, says he's not expecting to find many cases of outright fraud--more often, he says diplomatically, it's a case of "not being aware of the eligibility requirements, or in some cases not changing coverage when something happens, whether it's a divorce, or marriage, or [a child] becomes too old to become covered." He says that he expects the $200,000 audit to pay for itself: "It's rare that the rate of people who are removed from coverage as a result of the verification process doesn't outweigh the cost of implementing it."
[Originally published in May, 2010.]