Shruti’s husband had a severe heart attack, and he was rushed to the hospital. Shruti knew that he had a health care plan in his name, and she did carry his id with her, but given the emergency situation and her ignorance about the policy details, she was in a very tricky spot. She was nervous, and when told by the hospital authorities to contact Third Party Administrators (TPA) for insurance details, it sounded Greek to her! She didn’t know anything about it except that she was guided towards the concerned counter. Thankfully, TPA officials were helpful and provided complete assistance to her about hospitalization, claims, and documents required. The article is about the “Role of Third Party Administrators”.
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What Exactly is a TPA?
TPA is a third-party administrator that works as an intermediary between the insured, the insurance company, and the healthcare providers when it comes to health insurance. They are not employed by the insurance companies but are the outsourced entities to take care of all claim-related procedures after the customers have bought the health policies.
How Do They Work?
Insurance Regulatory and Development Authority of India (IRDAI) introduced TPAs in 2001 to help the process of claims in the health insurance sector become more efficient and smooth. Once the health insurance policy is issued, then the insurance company hands over the complete details of the customer to the Third Party Administrators (TPA). It then becomes the responsibility of the TPA to issue ID cards to the customers, manage their data, helps them with cashless health insurance as well as work on the claims filed by them in case they select a non-network hospital for the treatment.
Primary Functions of TPA
Cashless Hospitalization
The TPAs are responsible to help the insured go through the process of availing of this benefit.
Manage Claims
The insured is supposed to file all the necessary documents with the TPA regarding their claims, whether they are hospitalized in a network hospital or a non-network hospital. After verifying the details and confirming with the insurance company, TPAs either disburse the claim amount, ask for more documents or reject the claims and give valid reasons for the same
Maintain Customer Database
TPAs are authorized to maintain complete customer records, their medical history, and claims history, assign unique identification numbers, and also collect premiums from them.
Value-added Services
TPAs also provide extra health care services like helping in getting beds in a hospital, ambulance services, consultation with a specialist, supply of medicines, etc.
Customer Service
This is a highly valuable service provided by the Third Party Administrators (TPA). They have full-time medical practitioners working for them who can guide a patient about the need for hospitalization as well as with other queries if there is a planned hospitalization
Role of Third Party Administrators
TPAs have helped insurance companies in managing their business in an efficient manner, thereby ensuring that customers get the best possible service. While their primary role has been for the cashless health insurance policies, it is also to be noted that in case they don’t perform their duties honestly and as per the regulations of the sector, IRDAI has the right to cancel their license as well. Even the insurance companies sometimes work with more than one TPA to improve operations and provide better customer service.
Be informed of your TPA as mentioned in your policy documents so that you can get the best possible help in times of need. Health policies work best when their benefits are actually utilized by the buyers. TPAs play a major role in achieving this objective.
Need of Third Party Administrator
As we all know that Third Party Administrators is a brokers between the insurance company and the insured person, but there is a certain role of TPA, which is provided by IRDA. In the year 2001, IRDA introduces the Third Party Administrator service to the common people for making things easy. Just like – claim settlement, expenditure, and settling the other issues related to insurance.
Delivery of Services – Talking about the certainty of service delivery is quite a disbursal, as an insured person you know about insurance plans that are good but TPA plays a crucial role when we talk about getting the benefit of services.
Procedure & Due diligence – The procedure of claiming for coverage and till the claim is settled, in every process, you need someone who can help you in every possible way and TPA knows exactly how to manage the things. Procedure of every process and how much diligence you need to settle any claim, TPA can make the process smooth and easy for you.
New Management System – Sometimes we are not familiar with the new management system and any question related to insurance bothers us a lot, and the new jury and the new system are not enough to help us, or else the cooperation done by it is not enough. In this situation, we need the TPA, who can resolve our problem easily and make things smooth for us.
Minimize costs/Expenditure – With the help of TPA, you can also get some leverage in an insurance policy. Minimizing costs is not easy but you can try and TPA know how you will get some discount in terms of minimizing cost.
Greater Penetration of Health Insurance – The TPA knows all the things related to insurance very meticulously and he knows everything. Talk about health insurance, so he knows better how to go inside any plan this is why TPA is important for us.
Increase the knowledge base of health care services – Just like TPA, we also need to have a thorough knowledge of our insured plan. Many times you are barred from those services because we do not know that this service is available with our insurance plan and it’s a shame for us. For this reason, we also have to create a treasure trove of knowledge within ourselves.