Friday
Apr102009
« TPAs reduce costs, increase risk »
Friday, April 10, 2009 at 05:20PM
Companies looking to provide healthcare benefits for their employees may have a difficult decision ahead of them. Companies want to reduce costs and are demanding choice and service from their healthcare benefits provider. These employers are becoming better educated and savvy about the industry and are pushing for more personalized service.
Leigh Doyle wrote an excellent article on the Canadian TPA market. The Benefits Canada Group Insurance Report shows a group insurance market of $26.2 billion is growing at rate of 6.7%. While the pure non-insured premiums providers are growing faster at 8.7% with a smaller $11.2 billion market.
Leigh explains that TPAs can provide better service to employers, especially for unconvential plans and high service groups and cases. This emphasizes that TPAs should be all about customer service and flexible offerings. Alternatively insurance companies haven't come up with new benefits to distinguish themselves, which opens up more opportunity for TPAs to compete.
And we believe competition makes for a healthy market, where employers and employees will see better and personalized plans.
It's well known that Canada and the U.S. have an aging workforce. Cost containment will be a growing issue employers and employees will face as the baby boomers stress the system. One train of thought is preventative medicine -- address potential problems early in the hopes on reducing costs (and suffering) later. Medicine is one approach.
Mining data is another way. For instance, using information to notify case managers on diabetes patterns is a well known example. Identifying drug combinations with other procedures can suggest potential long-term, large case management risks.
However both insurance companies and TPAs have their place in the market. A balance needs to be weighed if you're considering TPAs. Do the research necessary for fee comparison but also on the claims adjudication, "which can very quickly offset any savings they have gained in fees."
Leigh Doyle wrote an excellent article on the Canadian TPA market. The Benefits Canada Group Insurance Report shows a group insurance market of $26.2 billion is growing at rate of 6.7%. While the pure non-insured premiums providers are growing faster at 8.7% with a smaller $11.2 billion market.
Leigh explains that TPAs can provide better service to employers, especially for unconvential plans and high service groups and cases. This emphasizes that TPAs should be all about customer service and flexible offerings. Alternatively insurance companies haven't come up with new benefits to distinguish themselves, which opens up more opportunity for TPAs to compete.
And we believe competition makes for a healthy market, where employers and employees will see better and personalized plans.
It's well known that Canada and the U.S. have an aging workforce. Cost containment will be a growing issue employers and employees will face as the baby boomers stress the system. One train of thought is preventative medicine -- address potential problems early in the hopes on reducing costs (and suffering) later. Medicine is one approach.
Mining data is another way. For instance, using information to notify case managers on diabetes patterns is a well known example. Identifying drug combinations with other procedures can suggest potential long-term, large case management risks.
However both insurance companies and TPAs have their place in the market. A balance needs to be weighed if you're considering TPAs. Do the research necessary for fee comparison but also on the claims adjudication, "which can very quickly offset any savings they have gained in fees."
tagged insurance TPA
insurance TPA
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