Magazine article Risk Management

You and Your TPA Making It Work

Magazine article Risk Management

You and Your TPA Making It Work

Article excerpt

If you never have had second thoughts about the quality of service you are receiving from your third your administrator, skip this article; unfortunately, you are in a minority. The results of the 1998 Quality Scorecard revealed a serious dissatisfaction on the part of risk managers with their TPAs. Why? After all, few companies select a TPA without first doing a thorough evaluation.

To find the answer, one must look beyond the raw capabilities of an administrator. Besides the ability to meet program requirements, success is dictated by the relationship between the two parties. The path to greater quality and satisfaction lies in six keys for effectively managing the relationship.

Establish Clear Expectations

Unless you have well-defined philosophies and principles for claims management, your TPA cannot follow your lead. Time spent working together to clarify your intended direction is well invested.

Designing a claims philosophy helps answer questions about how your organization intends to treat the process. A clear set of guidelines on issues of importance to your company will pay dividends in consistency of application. The principles you set out can, and should, be translated directly into the TPA's internal claims handling instructions.

Manage the Relationship

Poor communication is often the main reason for the downfall of the relationship with your claims provider. Since the customer is king, you may think of yourself as a benevolent dictator. Even as a dictator though, you have certain obligations. Once your claims handling procedures have been clearly communicated to your TPA, you need to also consider how, when and how often you want to be involved.

Numerous studies have addressed the benefit of active involvement in your claims program. It's a good idea to engage in frequent communication with everyone involved in the process.

A good TPA account manager will become a natural extension of your risk management team. He or she can work with you to become familiar with your operating environment and help translate your objectives into goals for the other TPA personnel working on your account. Moreover, a strong account manager will serve as your advocate when monitoring the interaction between your field locations and those of the TPA.

Your TPA's senior management should be familiar with you and your account. Nothing goes further than a first name relationship with the key decision makers in an organization. Their personal interest in your account helps ensure that your philosophy is translated into action at the field level.

Developing a strong relationship between your field locations and the TPA's branch manager or supervisor is also critical. Again, interest in your company is going to bring rewards in terms of proper execution of your requirements.

Finally, don't overlook opportunities to educate and seek input from the field claims personnel about your account, objectives and operations in general. Your results are directly proportionate to the amount of communication that takes place at this level.

Frequent communication is essential, such as holding annual meetings with TPA claims personnel. Translating your claims costs into bottom line success is a powerful way to help your TPA understand and buy into your objectives.

Once you have laid the groundwork for open communications, it is time to examine your results and look for ways to improve.

An objective Eye

Whether or not your company has embarked on a formal quality evaluation program, it is critical to create a culture where continuous improvement is paramount. Having a TPA that follows a recognized, ongoing quality process is invaluable

Choose six to eight key indicators, including both lead and lag markers, to measure results. Choose markers geared toward objective and readily available information, and evaluate with an overall view of the company. …

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