The Issue: Mileage Billing “Gaming” and Its Pervasiveness
The issue centers on a practice where courier drivers manipulate the sequence of their deliveries to inflate their perceived mileage and, consequently, their pay. This is possible because many courier companies invoice their customers based on the executed route, not the optimal one.
The “gaming” process typically works as follows:
- Non-Optimal Sequencing: A driver is given a set of stops (e.g., 6 deliveries). Instead of executing them in the most logical, geographically efficient order, they intentionally perform them in a sequence that requires more driving distance. For example, they might drive past a stop, go to a further one, and then backtrack to the one they passed.
- Increased Mileage and Pay: Since the courier company’s billing system often uses the recorded delivery sequence to calculate mileage, the driver’s intentionally inefficient route results in a higher mileage count. This leads to a larger paycheck for the driver, as they are often paid a per-mile rate.
- Cost Passed to the Customer: The courier company, in turn, invoices the pharmacy or long-term care provider for this inflated mileage. The customer, without a robust auditing system, unknowingly pays for these “fabricated” miles.
This behavior becomes pervasive in the driver pool through a social learning process:
- Knowledge Sharing: Drivers who discover this loophole share their “trick” with other drivers. This often happens organically through conversations at the depot, during breaks, or even on internal communication channels.
- Perceived as a Perk: What begins as a clever hack quickly becomes a widely adopted practice, perceived as a legitimate way to “maximize earnings” within the system’s rules.
- Absence of Consequences: Because the courier company’s billing system is typically set up to accept the executed sequence, and the customer isn’t auditing, there are no immediate consequences for the driver. This lack of accountability reinforces the behavior and encourages more drivers to participate.
Our REMEDY: Auditing for Optimal Mileage
Our remedy is designed to identify and eliminate this fraudulent billing practice, ensuring the customer only pays for the most efficient and necessary mileage. The process involves:
- Comparing Executed vs. Optimal Sequence: For every set of stops on a given delivery route, we don’t just accept the sequence reported on the invoice. Instead, we take the same list of stops and run it through a route optimization analysis. This analysis calculates the shortest, most efficient path (the “optimal sequence”) for those specific stops.
- Identifying “Gaming”: We then compare the mileage from the driver’s executed sequence (as reported on the invoice) to the mileage of our calculated optimal sequence. If there is a significant discrepancy, it’s a red flag for potential “gaming.”
- Re-Invoicing and Disputing the Balance: Once a discrepancy is confirmed, we don’t pay the full invoiced amount. Instead, we calculate what the invoice should have been based on the optimal mileage. We then dispute the difference with the courier company, demanding a refund for the overcharged amount.
- Data-Driven Accountability: By systematically tracking these discrepancies, we can identify which drivers and routes are most frequently involved in this fraudulent behavior. This data provides concrete evidence to present to the courier company, holding them accountable and providing them with the information needed to address the issue with their drivers.
This rigorous auditing process has proven highly effective. The example of returning over $1 million to a single customer demonstrates the significant financial impact of this pervasive issue. By ensuring we only pay for the optimal drive mileage, we not only protect our customers from fraudulent overcharges but also incentivize courier companies and their drivers to operate more efficiently, creating a more honest and fair billing ecosystem.