What is a TPA?
TPA stands for Third Party Administrator.
Employers typically partner with a TPA to administer their self-funded health plan. A TPA acts in concert with the employer in designing, launching, managing the plan. Some of the tasks performed by a Third Party Administrator include designing a schedule of benefits, printing plan documents and employee ID cards, constructing SBCs, claims processing, and handling customer service tasks. The TPA can also help the employer find a healthcare network and Pharmacy Benefits Manager.
In essence, the TPA will administer most of the tasks that your fully insured carrier handles. While some very large employers may administer these tasks internally, most small and mid-sized employers choose to outsource these tasks to a TPA in order to stay compliant with all regulations and streamline the plan management process.
When you start a self-funded plan, you can work with a TPA of your choice. Before choosing a provider, it’s important to find out what services they provide, what their fees or charges look like, and to ensure that they carry the proper licensure to work in your state.
For more info about the TPAs that we partner with, feel free to contact us at (217) 774-2155
