Let’s address the attitudes and misconceptions that can lead to fraud
By: Bill Zolis
One of the problems with preventing misuse of benefits – not to mention outright benefits fraud – is that most employers are reluctant to take measures or introduce controls that might make legitimate access to benefits more complicated, or that might make plan members feel uncomfortable when they submit a claim.
These are very legitimate concerns, especially given that benefits plans are often a centre-piece in building the “well workplace” and a culture based on mutual trust and support. A heavy-handed approach to review of claims, delays in approvals, or a more complicated process could well create an atmosphere of mistrust that would unfairly affect the large majority of plan members who play by the rules and wouldn’t even consider cheating.
However, that does not mean that plan sponsors should not be taking reasonable and long-term measures to ensure that all approved claims are entirely legitimate.
Yes, there are some very serious fraud detection and prevention strategies and resources available through our providers and industry associations – Artificial Intelligence review of large volumes of claims data being one of the most powerful.
But I also think that a successful strategy has to be built on consistent communication with plan members. I think a big part of the solution lies in fostering a positive workplace culture, and heading off any negative attitudes and perceptions that could create an environment in which misuse of benefits might start to seem acceptable to some employees.
– Always start with positive communication and education about your benefits plan: this is our plan, here’s what’s covered, here’s how to access benefits and services. This should be routine – not just a quick orientation at the time of hiring. As a rule, I think, we should update employees on the status of their benefits plans several times per year, or whenever there are changes or updates to the plan. And the bulk of that communication should be very positive in explaining – even celebrating – what benefits are offered and how to access them properly.
– Address the big-picture realities of benefits: they are part of your compensation package – you, as a plan member, effectively have a stake in the integrity and financial sustainability of the plan. If someone is unfairly taking more than their fair share out of the plan, it will affect all plan members down the road. It could result in a more complicated claims approval process. it could limit the plan sponsor’s ability to improve benefits in future, and it could even result in cutbacks to certain benefits if the costs spiral out of control.
– Be seen to be concerned and taking claims integrity seriously. For example, you could send a benefits report to plan members, including the percentage of claims in the last year were routinely approved – it will be a reassuringly high number – and what percentage were subject to review. This will send a number of important messages. First, that most claims are routinely approved without any fuss, and that the benefits plan is working for members. But, second, it will also send the message that all claims are taken seriously, reviewed and just possibly questioned if anything seems out of order.
– Address some of the vague misconceptions about misuse of benefits. Most people, as I can’t stress enough, just wouldn’t deliberately cheat the system and essentially steal from their employers’ benefits plan. But it can happen – and I’ve seen it happen – that some negative attitudes and perceptions gradually take hold and make misuse of benefits seem less serious. We need to address these misconceptions and refute them consistently through our positive communications regarding benefits.
Here are some of those mistaken assumptions that can lead to misuse of benefits.
– “Nobody cares.” Yes, we do care and it’s part of the plan administrators’ job to make sure that all plan members access benefits properly and easily. The benefits provider cares, they’re always on the lookout for fraud and misuse, and they take it very seriously. Your fellow plan members care, or ought to, because it’s their plan you’re messing with.
– “Benefits fraud is a victimless crime.” Actually, all plan members have a stake in the integrity of their plan. There’s the employer’s bottom line. There’s the total amount of resources that are available for benefits. There’s the atmosphere of trust that may be compromised.
– “Everyone is doing it and it’s no big deal.” Not everyone is doing it. In fact, most people wouldn’t dream of cheating, or compromising their integrity – or risk losing their jobs.
– “Most claims just flow through the system, and nobody even looks at them.” Yes and no. A routine claim for a semi-annual dental cleaning would indeed most likely sail through. But an expensive orthodontics claim might get a quick second look, and anything that looks like it might fit into a pattern of potential abuse would be examined closely.
– “The worst that can happen is that my claim might be denied.” No, actually the worst thing that can happen is that you get charged with fraud and lose your job. Yes, in most cases, an ineligible claim might simply be denied, with the plan member and the service provider red-flagged for future claims. But if the review shows any signs of a pattern or organized scheme, there will be a very serious investigation.
Benefits misuse – essentially fraud, after all — is an issue that can have severe financial and reputational repercussions for businesses and can seriously undermine the level of benefits available to employees. It is essential to implement measures to detect, stop and ultimately prevent abuse of the system.
The place to start, I think, is to communicate openly with employees about their benefits long before any fraud takes place and to bring them onboard with the goal of maintaining the integrity of what is, after all, their benefits plan.
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Celebrating 20 Years at Callery Group and then Penmore Benefits with Mats Sundin
Celebrating 20 years of dedication and hard work in my career journey! Today marks a significant milestone as I reflect on the countless achievements, challenges overcome, and growth experienced over the past two decades. As I look back on the journey, I am filled with gratitude for the opportunities that have come my way, the invaluable lessons learned, and the unwavering support of colleagues, mentors, and loved ones. Each day has been a step forward, contributing to the person I am today and the successes I’ve achieved. Here’s to celebrating this milestone with gratitude and looking forward to the exciting possibilities that lie ahead in the journey ahead. Thank you to everyone who has been a part of this incredible journey!
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I really appreciate comments, ideas, suggestions or just observations about the blog or any other topics in benefits management. I always look forward to hearing from readers. If there’s anything you want to share, please email me at bill@penmorebenefits.com.
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