At Hershenberg & Stone-Walsh Insurance we are always looking for ways to help our clients run a well-oiled employee benefits program. Part of our process is to coach employers/HR/Office Managers on best practices to avoid any insurance-related pitfalls. One easy method to stay a step ahead of problems is to audit monthly insurance invoices and payroll reports. Here are a few examples of how creating an audit process can save everyone time, money and unnecessary stress.
Many businesses set up automatic bill pay for their recurring bills. It sure is a load off knowing that your bills will be paid automatically every month, right? How would you like to find out that for the last 6 months you’ve been paying for an ex-employee and his family’s medical, dental and vision plans to the tune of $7,000 worth of premium? How’d that happen? You told them that the employee no longer worked there, but as usual, they have no record of that conversation. Since money slips quietly out of your company’s checking account every month and the invoice that the insurance carrier sends goes unnoticed, you are fighting a losing battle.
Here’s another example. You finally found the perfect employee, they are on time, do great work and are a pleasure to be around. You couldn’t have picked a better employee, bravo! Well, somehow payroll forgot to start his new employee benefit payroll deductions and for the past 6 months, you’ve been footing the bill without collecting any of his shares. At this point what are your options? One, ask your employee to fork over the $3,600 in deductions he owes the company. Or two, you let it slide and eat the cost. What’s the result? You either have a disgruntled employee who does not feel that he should have to pay for a payroll mistake, or he has an employer who’s out some money that can’t stop wondering how his model employee didn’t notice he was $300 richer every paycheck. Both outcomes are undesirable.
Here’s another classic. Your sales superstar Julie went out Friday night to the local food truck festival. One bad piece of meat and a week later she’s in the emergency room hallucinating and diagnosed with Trichinosis. Julie has been diligently paying her medical insurance deductions for the past 8 months, why is the hospital telling her she has no insurance? Because she doesn’t. Turns out, the carrier never processed her application. Why? Because the office manager emailed her application to the wrong insurance carrier. Whoops!
These scenarios could have been prevented with a quick 5-minute look at the insurance bills and payroll registers every month. The time spent performing these quick audits is well worth keeping HR headaches like these at bay. As a business owner, you have more important things to worry about.