University initiates Dependent Verification Program to curb costs

November 01, 2012

UNIVERSITY PARK, Pa. – In an effort to control rising health-care costs for Penn State and its employees, the University will participate in a Dependent Verification Program, to begin in January 2013.

“This kind of verification has not been done in the past, when we historically allowed faculty and staff to self-identify dependents,” Robin Oswald, director of employee benefits, said. “The new process will show that we’re being fiscally responsible and proving we’ve done our due diligence in making sure those dependents receiving Penn State benefits are actually eligible.”

In the past, the University has relied on its faculty and staff to know and comply with criteria for dependent eligibility, Oswald explained. The Dependent Verification Program will ensure that the criteria are communicated effectively and only those who are eligible for benefits will be covered going forward. This change could potentially save the University millions of dollars in health-care costs, a budgetary area that continues to be a challenge for most employers, including those in higher education.

Oswald said this initiative has the potential to save $3 million to $5 million in health-care costs alone, and a savings as high as $8 million in tuition discounts.

Susan McGarry Basso, associate vice president of the Office of Human Resources, will send a letter to Penn State employees this month with a reminder about which dependents are eligible for benefits, as well as details about the verification initiative and how it will take place.

“This process is not intended to be punitive in any way,” Basso said. “It essentially is a method to dis-enroll individuals who may have been unintentionally covered by University benefits.”

Right now, Penn State has 22,500 dependents enrolled in its health-care program and 3,400 using the tuition discount. Generally, during these types of verification programs, between 5 and 7 percent of participants are found to be ineligible.

To undertake a verification process of this magnitude, the University has hired Aon Hewitt, a human resources consulting firm regarded for its depth of auditing experience and technology. Aon Hewitt was vetted and selected by a Penn State committee consisting of human resources representatives, faculty and Office of Human Resources staff. The company also will manage ongoing verifications for new faculty and staff until the University’s own technology can support the program.

Penn State employees declaring dependents who receive health, dental or vision benefits or participate in the tuition discount will need to submit verification of the relationship they have with the dependents. Birth certificates or adoption decrees are necessary for dependent children, and marriage certificates and redacted tax returns -- blocking out sensitive personal information -- that show only that a couple is filling jointly are necessary for married couples. Other common documents to prove relationships may be requested instead. Oswald said copies of these documents can be submitted electronically as a photograph, as a scanned digital document or by fax, or copies can be mailed to the consulting firm.





Last Updated November 01, 2012