Third-party administrators help to manage your company’s group benefits, particularly health and dental claims that are typically self-funded.
Understanding the role of Third-Party Administrators (TPAs)
The use of a third-party administrator is now common in many businesses, and the range of tasks they undertake is growing. The market size of the U.S.’s third-party administrators and insurance claims adjusters industry has increased by 5.1% annually between 2015 and 2019.
The benefits of using a Third-Party Administrator for companies
A TPA will help you to make informed decisions, optimize performance, and ensure compliance to meet your business objectives. They also focus on issues such as liability risk management, fiduciary responsibility, and de-risking. Here are a few ways using a TPA can assist your company.
1. Calculate plan contributions accurately
Using a third-party administrator can help calculate accurate contributions required to fund your plans. As an employer, you are allowed some flexibility when deciding how much to contribute to the plan. Your actuarial TPS will structure the plan document while considering employee demographics so that annual contributions will meet your specific objectives.
2. Re-enrollment made easy
Shopping for group insurance plans can be daunting when different companies require different application forms. Employers sometimes need help with getting all the various forms back from employees. However, if you use a third-party administrator, you will only need one enrollment form for your employees, and there is no need to re-enroll when switching carriers. This massive time-saver alleviates the burden of distributing, collecting, and submitting the various forms.
3. Increased savings
TPAs offer the most competitive deals when they create a plan for your employees. TPAs usually have thousands of employees under contract from different companies. This allows them to provide a better deal with an insurance carrier against a broker/advisor with a far less significant number with a specific carrier. They also offer several other cost-efficient services, like identifying reimbursement opportunities that your business is eligible for.
4. Protection from fraud
When administering the specifically designed plans for your company, TPAs can also keep a check on any employee compensation fraud. Such fraud is a $30 billion problem annually in the United States.
5. Ensuring compliance
Another benefit of TPAs is that they ensure ongoing monitoring of regulations, laws, and court decisions for the legally compliant management of the designed plans. They provide necessary solutions to maintain compliance if there are any issues or risks.
6. Minimize costs related to injuries
Injuries at work happen primarily due to negligence. Such injuries cost nearly $53.9 billion in wages and productivity in 2019 in the United States.
TPAs are responsible for educating your employees about best safety practices. They can even help develop a safety program to reduce the number of claims made yearly.
The Edenred and TPA partnership
Edenred partners with TPAs to provide their clients with the best possible benefits packages by providing:
- Training -We provide extensive training to your team at the sales and operational levels, including weekly calls and walk-throughs to drive your objectives and ensure your clients are making the most of the program.
- Dedicated Account Manager – Your account manager is there to help you with all your support needs, including assisting whenever you or your client has a question or concern.
- Unwavering support – We provide our third-party administrator clients with a variety of enrollment and marketing materials and facilitate the administration of your program.
- White Labeling – You can customize your online platform to your company’s brand or that of your clients.
Schedule a meeting with us today to see how we can enhance your clients’ benefits.