AUDIT COMMITTEE SUMMARY
April 19, 2016
Audit of Human Resources Department
3rd Party Benefit Vendor Contract Monitoring
Report Issued February 2, 2016
Background
The City of San Antonio strives to provide a competitive compensation and benefit package to attract and retain a highly skilled workforce. Human Resources' (HR) core functions include but are not limited to employee benefits and wellness that is implemented and administered by HR Employee Benefits staff.
HR staff in partnership with Third Party Administrator (TPA) vendors are responsible for the design, administration, education, and customer service of the following programs: the self-funded indemnity health care and dental plans, fully insured Dental and Vision Plan, Life Insurance plan, Employee Assistance Program (EAP), Short and Long Term Disability Program, Wellness Program, Occupational Medical Clinic, Deferred compensation, and voluntary benefits coverage. HR is responsible for TPA contract monitoring to ensure that the City and the vendors are in compliance with all contract terms and conditions.
Audit Objective
Determine if HR is properly managing and monitoring its third-party health insurance providers.
Audit Scope and Methodology
The audit scope included HR's current contract monitoring processes. We reviewed contract related provisions from January 2013 through March 2015. Audit scope did not include insurance claims.
Audit Conclusions
HR management is not effectively managing and monitoring the healthcare and benefit TPA vendors.
* HR is not effectively monitoring contract provisions and performance standards for healthcare and benefit TPA vendor contracts. HR does not have formal procedures to monitor TPA contracts and controls to ensure third parties are in compliance with contractual requirements.
* Business Associate Agreements (BAA) do not address current HIPAA requirements.
* HR does not have controls in place to ensure changes, updates ...
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