Paylogix® Philosophy

philosophy

“Service to others is the rent you pay for your room here on earth.” -Mohammed Ali

Paylogix® is a leader in the premium administration industry. This encompasses the tasks of billing, collection, reconciliation and disbursement of group and voluntary benefit plan premiums. Premium administration is often referred to as the Consolidated and/or Single Point Billing® business. In essence, we’re in the business of simplifying the business of paying and collecting premiums. We generate a single billing statement for multiple products and/or multiple carriers to reduce the burden to the premium payor—often referred to as the “client” or the “Sponsoring Organization”. The number of products we incorporate into a singe bill helps to reduce this client’s bill paying chores. With simplification in mind, we pioneer and incorporate innovative technologies like our web-enabled Consolidated Billing® system to provide cost effective solutions and expert service. How we conduct our business can be answered through a series of related and more precise questions. They are:

What is Single Point® or Consolidated Billing®?

How is Premium Allocated to the Carrier?

What if the payment received is insufficient to pay billing with multiple products?

What is the length of time from receipt of premium to remittance to carrier?

What are the reconciliation Procedures?

How is money handled?

How is your administrative system structured?

How do you handle Communications?

What is Single Point® or Consolidated Billing®?

Premium administration has several aliases. These include Consolidated Billing®, Common Remitter®, Single Point Billing® and single slot administration. Regardless of what you call it, the benefits can lead to increased sales and reduced headaches. Premium administration includes the consolidation of multiple products from potentially multiple providers onto a single bill. It subsequently involves the receipt, reconciliation and breakout of the collected consolidated premiums with ultimate remittance to the respective providers.

Premium administration offers the Sponsoring Organization (employer, union or association) relief from the administrative burdens incurred with multiple benefit programs. A single deduction can be made for any number of benefits. Premium remittance to the Premium Administrator is often in the format most convenient to the Sponsoring Organization. Premium allocation, reconciliation reporting and data transfer is typically on an established protocol basis with the Insurer. The Premium Administrator acts as a “black box” protocol translator providing a simple and user defined interface to both the Sponsoring Organization and the Insurer while performing complex tasks at a cost savings to both.

Premium administration encompases a number of related functions. These functions, often used synonymously, differ in the following ways:

Common Biller: Presenting multiple bills from multiple providers to the premium payor. In essence this is a clearing-house function typical of EBP (electronic bill presentment) operations and Print & Mail houses.

Common Remitter®: The collection of gross premiums on behalf of an employer with the responsibility of disbursement to the respective benefit plan providers. This is essentially a bill payor function.

Consolidated Billing®: The presentment of multiple products in a single billing statement. This may include multiple products from multiple benefit providers.

Single Point Billing®: Acting as a hub in which billing is broken-down and disbursed for collection followed by the culmination of data and premiums for batch remittance to the benefits provider. This is a commonly used function in association type programs.

Single Source Billing: Acting on behalf of a benefits provider by performing billing and related administrative functions not in combination with any other products. This is typical of outsource billing functions to a third party by a benefits provider.

Single Slot Administration: The collection and remittance of gross payroll deductions through a single negotiated payroll deduction slot on behalf of a union for any number of union related benefits. Gross premiums are broken-down and disbursed to the respective benefit plan providers.

How is Premium Allocated to the Carrier?

Premium allocation is not an arbitrary administrative function. The money received does not belong to the administrator and every penny must be accounted for. A sophisticated system designed to orchestrate both mundane and complex tasks simplifies the Consolidated Billing® process. Billing statements are generated per the Sponsoring Organization and the Insurer requirements. Premium is received and allocated per employee deduction authorization agreements. Differences are resolved and reported to the appropriate Insurer along with final remittance and supporting data. Changes are incorporated in to the system for future billing and the cycle is repeated.

What if the payment received is insufficient to pay billing with multiple products?

If premium payment is insufficient, it is not allocated. The money doesn’t exist if the billing is not reconcilable. This places the burden of accurate record keeping on the premium payor in line with his or her fiduciary responsibilities. If the information is not evident at the time of payment receipt, the client is contacted immediately in an effort to resolve the issue as quickly as possible. Again, no payment data is entered until the discrepancies are resolved.

What is the length of time from receipt of premium to remittance to carrier?

Checks made payable to the insurance carrier are turned around in 48 hours as a rule. This assumes reconciliation information is made readily available. Typically the turnaround time is same day or within 24 hours.

What are the reconciliation Procedures?

We reconcile and allocate to the policy holder level. Premium payments are expected to match billing. Otherwise, exception reporting is expected. Manual billing provides a simple feedback section to report payment adjustments.

Fast response feedback items include:

TERMINATED
CANCELED
LEAVE OF ABSENCE
NO PAYMENT/OTHER
RETURN FROM ABSENCE

A quick inspection is made to verify that payment equals the billed amount. If not, a quick summation of reported adjustments is applied to verify adjusted totals. If it still doesn't reconcile on this grand scale, the responsible party for payment on behalf of that client is contacted immediately via phone and fax.

Once the necessary adjustments are identified, payment is applied. The system prompts the account administrator of any unpaid billing periods. Premium payment is entered into the system. This includes check number, amount, billing period applied to and date of receipt. Copies of check(s) are electronically stored in the system and adjustments are detailed for entry by another administrator. The results of applying adjustments is returned to the account administrator for final inspection and preparation for remittance to the insurance carrier.

How is money handled?

Controls

Incoming checks are received and recorded by account administrators. Checks are typically made payable to the insurance carrier. This is the preferred method and minimizes risk. Any checks made payable to Paylogix® are made payable as “f/b/o <name of sponsoring organization> ”. Deposits are made into separate and distinct f/b/o accounts.

Security Checks

Only authorized individuals can sign checks up to $25,000. Above $25,000 requires two signatures. Account balance and bookkeeping is handled by a separate department. Members of this department have no administrative duties related to the account(s).

Timing Deposits

Deposits are made within 24 hours of billing reconciliation.

How is your administrative system structured?

Administrative tasks are performed using a proprietary client/server database application created and maintained by Paylogix®. This system is fully web browser based using a Microsoft relational database management system, with an integrated electronic document imaging and management system. This enables us to efficiently and accurately handle reams of paperwork and numerous billing transactions. Current system use is measured at approximately 12% of capacity. The complete system runs under a Microsoft NT networked environment.

The application design is based upon a pyramid structure at the base of which resides all the Participants. Basic Participant information resides here and Products are subscribed to at this level. An Activity Log is maintained for each Participant to record policy activity and flag open items. All pertinent Participant related documentation is stored here and available on demand.

Each Participant is assigned to an Organization. Billing is at the Organization level and can include any number of Participants and products. An Activity Log is maintained for each Organization to record activity and flag open items. All pertinent Organization related documentation is stored here and available on demand.

Each Organization is assigned to an Association. An Activity Log is also maintained for each Association to record activity and flag open items. Again, all pertinent Association related documentation is stored here and available on demand.

How do you handle Communications?

All communication to participants and any member organizations are done in a manner that promotes the sponsoring organization. This approach is used to strengthen the relationship that exists between these entities as well as to promote further recognition for the program being offered.