The audit process is a two-tier (level) program that focuses on the employer's knowledge and implementation of the administrative, reporting, and claims management requirements.
Level 2 compliance audit
With the Level 2 compliance audit, we conduct a more comprehensive review of an employer's claim compliance and SI-40 reporting practice, which validates how much was paid out in claims costs. We can schedule and conduct these audits as needed based on the following triggers.
- Not in compliance with any area in a Level 1 audit
- Unexplained significant variances on the SI-40 from one year to the next
- Not able to provide material support for a reduction reported on previous SI-40s
- A high-risk self-insuring employer
- Concerns noted from prior Level 2 audits
- Multiple valid complaints in a rolling 12-month period
- Not been audited for more than four years
Frequency: Our self-insured department targets completing a Level 2 audit on all active self-insuring employers every two to three years.
Scope: The Level 2 audit will include determining the:
We'll notify the employer in advance of what audit information they need to provide.
Level 3 compliance audit
With a Level 3 compliance audit, we review all aspects of an employer's claims administration and reporting practices. We may schedule these audits based on the following triggers.
- Initial six-to-12-month audit for all new SI employers.
- Any employer who is not in compliance with any area of the Level 2 audit.
- Four years or more since the last Level 3 compliance audit.
- Finding a third valid self-insured complaint in any rolling 12-month period.
- A change of the administrator requires completion of our online Self-Insured Orientation Tutorial and shortens the four-year audit time line to 12 months from the point of turnover (change in administrators).
- Failure of an employer to demonstrate strong working knowledge and consistent practices with the SI process will result in a repeat Level 3 audit in the following six months to one year.
Frequency: As needed
Scope: The audit will include reviewing the:
- Timeliness of lost-time claim reporting to BWC.
- Timeliness of certifying claims.
- Timeliness of medical bill payments.
- Reasonableness of medical bill response.
- Timeliness of compensation payments.
- Accuracy of compensation payments.
- Timeliness of responding to treatment requests.
- Availability of claim file.
- Maintaining a complete claim file.
- Proper notification to injured worker on claims process.