Third party administration can provide lower costs, plan flexibility, personalized service and clearer legal compliance for your employee benefits plan. Since each TPA firm handles many clients and actively networks with other TPA firms to compare experiences, clients benefit from the practical insight of thousands of plans who've faced any problem. This level of collective experience and access to information resources can equate to big savings for your company and your employees.
Government compliance : Self-dealing arrangements and privacy issues of benefit plans are increasingly subject to government investigations and lawsuits. Employing a TPA can reduce this legal exposure by providing arm's-length dealings and privacy in many of the plan's fiduciary responsibilities. With an estimated 1,500 new laws, regulations, interpretations, official opinions and major court decisions that apply to plans each year, it is difficult for plan administrators to stay up-to-date. TPAs are in the forefront of finding, following, and shaping these decisions and can provide knowledgeable insights into policy trends and compliance. As the CFO of one of America 's largest companies stated, "We spend $100,000 on lawyers and consultants each time there's a new development, while companies that hire SPBA TPA members get the advantage of more reliable information for free."
Important Note : Most employee benefit government requirements (such as COBRA, MSP, military reserves, ADA , etc.) are employer laws...not technically requirements of insurance companies or benefit plans. While insurance and other companies may say, "Sorry, but that's your problem, not mine,” TPAs have played a special role to help client employers and plans to help meet the various requirements. This can protect an employer or plan from hundreds of thousands of dollars of otherwise uninsured claims and liability.
Cost Savings: Your independent TPA can bring you significant savings in several ways. First, of course, is that instead of paying 100% of the costs for in-house benefits administration staff, you pay only a fraction of that price for an even wider range of expertise. That, alone, can save you tens of thousands of dollars. Cost containment programs can also bring you claims cost savings. TPAs have been in the forefront of not just planning, but actually implementing effective cost containment for client plans. TPAs normally customize cost-containment programs to the needs of each client.
Flexibility : Your plan is the client and prime concern of the TPA firm! TPAs do not simply sell you a one-size-fits-all policy. As each organization and plan is different the TPA works with the client to design and operate a custom-made program reflecting their needs and funding environment. This flexibility also allows for the special wants and needs of employees, and can include specific cost containment programs for your plan.
Personalized Service : Just as the design and implementation of your plan is personalized...so, too, is the service. You are the #1 priority! Knowledgeable Customer Service representatives get to know each client plan, the covered employees, and the medical providers up-close and first-hand. This focused attention can often save client plans significant amounts of money but most importantly, provides you with answers when you have a question or need help.