Closer, Connected Relationships
Nearly all self-funded plans – no matter the size or format – work in conjunction with a third party administrator (TPA).
These partnerships differ from those between employers and insurance carriers as they tend to be much more interactive in nature. The role of TPAs is similar to law firms or accounting firms which are hired to provide ongoing professional services for the employer and/or health plan. TPAs take a team approach in working with employers, and the two form close, highly connected relationships. Communication is also more constant in the self-funded structure. This is a stark contrast to other employee health plans where contact is often limited to certain times of the year or info is only shared on a need-to-know basis.
TPAs have the experience to help both private- and public-sector employers better customize their health plans, the associated medical benefits, service offerings and stop loss insurance coverage. They stay up-to-date on the latest issues and trends in self-funding and are proactive about helping employers make any plan changes. Because TPAs work with multiple clients, they have first-hand experiences with trends and issues. Members of the national association of TPAs, SPBA, are also able to brainstorm with other TPAs nationwide and regulatory officials.
There are TPA firms of all sizes across the country. While all have their own strengths, some advantages of the smaller-sized TPAs include knowledge of the local health care market, flexibility, efficiency and highly personalized customer service.
The TPA’s Active Role with Regulations
When it comes to rules and regulations, TPAs play an integral role in assisting employers operating self-funded plans with ongoing compliance. This is especially helpful as agency regulatory requirements are constantly changing – and while employers may not have the resources to do so, TPAs remain vigilant about keeping up-to-date on them.
On a similar note, many TPAs are very involved on the regulatory front and actively participate in the process of shaping rulings with government officials, who recognize that TPAs are an accurate source of broad real-world situations.
Every employee health plan is as unique as the company that offers it, and TPAs fully understand this. Employers who self-fund have the added benefits of close working relationships with their TPAs, more flexibility in meeting their health coverage needs and ongoing compliance help.