Claims Auditing 101: Part 1

Macro Audits: What the Data SaysBy Ken Brownlee, CPCU  From the January 2012 issue of Claims Magazine

Some may call it “counting beans,” whereas others suggest that statistics are never a true guide about what is really happening. Reality lies somewhere in the middle of any audit process. When a railroad looks solely at costs and statistics, key workers get laid off, and car, locomotive, and track maintenance are postponed. This causes cars to derail, creating delays around the system, and the operating ratio climbs astronomically. The same is true for an insurance company or a self-funding commercial entity, be it a corporation, a governmental agency or an institution. Numbers and bottom lines tell only part of the story.  read more..