Customer Success Story

Identifying $40 Million in Disability Payment Errors for 1,000 Employees

A large cargo ship carrying stacks of colorful shipping containers across the ocean, representing an international transportation client in a Strategic Benefits Advisors case study on identifying $40 million in disability payment errors.
Challenge

One disability claim triggering a $40 million payment audit for 1,000 employees

An international transportation company with more than 80,000 employees had recently resolved an employee claim that uncovered the company’s need to pay nearly 1,000 disabled employees additional benefits. The company’s disability plan was managed by a third-party vendor, which began reviewing each employee’s record to determine the appropriate refund amount.

What was intended to be the quick clean-up of an isolated issue soon mushroomed into a comprehensive payment audit when the vendor discovered that several other errors had been made both systematically across the population and on an individual basis. The project quickly overwhelmed both the vendor and the client. Feeling pressure from employees to get disability benefits corrected in an accurate and comprehensive manner, the client and vendor reached out to SBA for help.

Solution

Reviewing every transaction for 1,000 employees to find every over- and underpayment

SBA delivered the following scope of services:

  • Familiarized ourselves with the disability plan provisions and all of the offsets that applied to the disability benefit
  • Studied detailed components of the pension plan, including several benefits that started and stopped at various points in time
  • Received and processed comprehensive transaction data for 1,000 employees, including all disability and pension payments received, overpayments reported, plan repayments made and other adjustments completed
  • Developed a detailed display for each employee showing their actual disability payment alongside what the payment should have been for every month since retirement; the display detailed the amount, duration and nature of every error that had ever been made and calculated the correct benefit amount going forward as well as the total overpayment or underpayment to the employee
Results

Correcting $40 million in errors with transparent documentation for each participant

In all, SBA completed benefit reviews for 1,000 employees and identified over $40 million in errors. All parties—the client, the vendor and the employees—were grateful that benefits were corrected in a comprehensive and transparent way. The detailed exhibits developed by SBA satisfied the inquisitive and thorough nature of the impacted employees.