10 Steps for Selecting a TPA10
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10 Steps for Selecting a TPA10
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By:
Clelland Green |
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How do you decide on a TPA? Finding a third-party
administrator (TPA) can seem like a daunting task. The
Society of Professional Benefits Administrators (SPBA)
states that 66 percent of all U.S. workers are covered under
self-funded plans. Most if these workers are managed by
independent, third party administrators. If you are trying
to find a TPA for your clients, here are ten things to help
you in that process.
1. Determine the needs of your clients.
* Who are your target customers?
* What types of workers do they have?
* Are your customers are fully insured, minimum
premium or self-funded?
* What size of self-funded groups do they have -
small (50-200 employees), mid-sized (200 to 2,000)
or large (more than 2,000)? (Note: This is
important because TPAs that serve only large
corporations may not be inclined to give proper
attention to a company group of 75 employees.
Employees kept waiting for insurance cards for two
months after enrolling, for example, will complain
to their chief financial officer or human resources
administrator. They, in turn, will be upset with
you.)
2. Look for a commonality among the types of customers
prospective TPAs serve. Are most of their clients in a
particular industry or sector? If so, they may not be a
match to the industry of your customers.
3. Define your target customers and their needs.
* Are they in a single state or if they are spread
out.
* Do they need a provider with online capabilities?
* Do they need a TPA that can provide self-service
for employees?
* Are they looking for one that provides real-time
information on claims?
4. Determine prospective TPAs. Ask around. Contact other
brokers for their opinion about the TPAs they¡¯ve dealt with.
Your best sources for TPAs are the SPBA and the Self-
Insurance Institute of America. Most high-quality TPAs
belong o one of those organizations, which can act as
initial filters.
5. Interview Questions
* Does the TPA have a profile customer? Does it
match yours?
* How many employees is the TPA currently serving?
* Is the TPA¡¯s style a good fit with your roster of
clients?
* What types of clients does it serve?
* What markets does it have for employer stop-loss
insurance?
* Which provider networks does the TPA work with?
* What prescription benefit manager does it work
with?
* How do they audit and verify the quality of their
claims?
Ask for specific information on areas such as claim
turnaround time, claims accuracy, inventory control and
call-to-answer rate. Does the TPA¡¯s claim system have
claims-editing capabilities, and if so, what types of edits
are included? A good system will have duplicate claim
checking, upcoding and unbundling. For example, the claim
system should be able to tell if the claim was unbundled and
whether the sex of the claimant matched the service
performed.
6. Access the TPA¡¯s claims processes. Find out if the TPA
has the ability to accept electronic claims, which
streamlines the claims process. Also determine if the TPA
manages paper, or if it has its claims scanned and then uses
electronic data interchange (EDI). In addition, ask about
the TPA¡¯s auto-adjudication capabilities. Scanning, EDI and
automation will indicate capabilities that will lead to
better service.
7. Investigate the TPA¡¯s Internet capabilities. At a
minimum, these should include enrollment and claims status.
If some of your customers are not tech-savvy, find out if
the TPA offers interactive voice response capabilities for
enrollment and claims status.
8. Ask about the types of reports your TPA can provide.
You¡¯ll often find that certain reporting capabilities are
provided in the base service, while others are available at
an extra cost. You¡¯ll want to find a TPA that provides
reporting capabilities as a base service. Ask if there is an
added cost for additional reports.
9. Find out if the TPA has call tracking. You¡¯ll want
requests for service to be automatically delivered through
the hall-tracking system. Find out what its service unit
can complete without the assistance of other departments.
This will cut down on lost time for your clients.
10. If you are still unsure of which TPA to select, ask for
references. You should be able to make your decision upon
reviewing the experiences of other agents. Keep in mind that
depending on your needs, you may have to work with more than
one TPA.
Clelland Green simplifies insurance topics and plans to help consumers make the best insurance choices for their situation and budget. To learn more or to get an online insurance quote, visit http://www.benepath.com.
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