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Audit This

September 2, 2010

There’s a very unassuming article in the Buffalo News today that ought to be required reading for state leaders. It describes the results of an audit of state employee health benefits.

Surprise. The audit found costly mistakes, errors and fraud.

Much of the savings, more than $25 million, comes from identifying people who were receiving benefits improperly.

Sometimes this was due to people not understanding the rules of eligibility. Other times, people understood the rules too well and took advantage of the system.

So far, some 27,000 people have removed from the rolls, and the review is continuing.

What was different about this particular audit is that it was conducted by a private firm that specializes in finding health care savings for large corporations.

Interestingly, the success of this effort has not been challenged by either the Civil Service Department or the unions.

And it raises the question of what level of recurring savings might be obtained if the use of such private audits could be expanded.

There’s never a hero in stories like this, but in this case it might be Buffalo Assemblyman Sam Hoyt, who pushed for the independent audit for years. News of the audit comes after city officials in Buffalo found that they were insuring hundreds of dead people.

Auditing is such a sleepy discipline, but it is imperative that city and state governments either become experts at it, or find people who are.

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