Objective

To determine whether EmblemHealth Plan, Inc. overpaid dental claims for members covered by two subscriber plans under the New York State Dental Insurance Program. The audit covered the period from January 2018 through October 2022.

About the Program

New York State provides dental insurance benefits to certain State employees and their dependents. The Department of Civil Service contracts with EmblemHealth Plan, Inc. (Emblem) to process and pay claims for services on behalf of the New York State Dental Insurance Program (Dental Program). Coordination of benefits (COB) is a process health insurance companies use for paying health care claims when an individual is covered by more than one insurance plan. This process determines which plan pays the full benefits first (primary payer) and which plan pays remaining expenses second (secondary payer). This is necessary to prevent duplicate payment of services by the primary and secondary payers.

In circumstances when both spouses/domestic partners receive benefits under the Dental Program through their respective employers, each person is entitled to separate coverage (referred to as subscriber plans), making Emblem both the primary and secondary payer. For instance, in the case of a married couple where both individuals obtained dental coverage, because the Dental Program covers each enrollee and their qualified dependents, each spouse is covered as an enrollee under their own subscriber plan and as a dependent on their spouse’s subscriber plan. With Emblem as both the primary and secondary payer for each spouse, in many instances, this may allow for no cost for the member.

During the audit period, Emblem processed and paid approximately $252 million in claims for covered services. Of this, approximately $4.5 million required COB processing associated with two Dental Program subscriber plans.

Key Findings

We identified $492,061 in overpayments for services processed with COB for the audit period, January 2018 through October 2022, because Emblem failed to correctly coordinate benefits with each member’s other subscriber plan. For example, Emblem often paid the full amount for a service twice
under both members’ subscriber plans. The overpayments were, in part, caused by manual Emblem processing errors.

Key Recommendations

• Review the $492,061 in COB overpayments identified and make recoveries, as warranted.
• Review controls and take corrective action to address issues causing overpayment of COB services, including lack of COB information and processor error.
• Develop an ongoing process to identify and review the appropriateness of COB claims and recover any overpayments.