Benefits of hiring a third party administrator
It’s best to discuss the benefits of hiring a TPA in the context of designing and managing a cost-effective self-funded healthcare plan. A TPA’s first role is that of service provider to the plan, a role that continues as your self-funded healthcare plan evolves.
TPAs supporting self-insured healthcare plans also may take on support for administrative burdens that typically otherwise rest on the human resources and finance teams within an organization. These admin tasks might include:
Member enrollment
Claims adjudication
Reimbursement
Reporting and record-keeping
Consolidated billing
In addition, a TPA may also offer detailed reporting, providing a better understanding of healthcare expenses.
What services do TPAs provide?
The services provided by a TPA may span a broad spectrum and can often be customized. As in many industries, you can tailor your agreement to match your requirements. TPA services can include:
Health benefits reporting and analytics: A TPA that reports on your health program’s networks and point solutions should provide regular and reliable reporting on claims, members, and other metrics associated with your self-funded plan.
Reducing the burden on your HR department: Your TPA can help with open enrollment for your plan. Your TPA may also be able to assist with communication materials or onboarding events.
Adjudicating claims: A TPA can adjudicate whether claims are reimbursable under the plan and take care of processing member claims for your business.
Customer service for plan members: Enlist the help of your TPA to answer plan-related questions and provide member assistance.
Healthcare provider network access: A TPA can help you connect your self-funded plan to trusted healthcare provider networks. You don’t need to assemble all the parts of your plan yourself.
Detailed healthcare expense reporting: Gain access to more detailed healthcare expense data without compromising employee privacy. A TPA can provide you with reports to better understand healthcare costs. Use the data to work with your TPA and design wellness programs or health-based incentives that can reduce costs in the future.
Supporting stop-loss coverage by working with insurers: Stop-loss insurance reduces the risk for self-funded health plans. If actual costs outrun expected costs, a stop-loss policy can cover some or all of the unexpected expenses.
Consolidating payments for providers: A self-funded plan may receive services from multiple providers. A TPA may be able to facilitate making payments to these service providers, thus streamlining your administrative lift.
Working with brokers and health insurance consultants: Even experts in the business turn to TPAs for their broad understanding of how the pieces of the health insurance puzzle fit together.
While a TPA can handle a wide range of healthcare plan needs, you can also often choose customized services to meet your needs. For example, some businesses might choose not to use stop-loss insurance. Your TPA agreement isn’t necessarily all-or-none, but it’s often more efficient to utilize a TPA.
Learn more about our TPA services by designing your health benefits plan.
