TPA stands for Third Party Administrator. It is an intermediary company between an insured and an insurer. It provides a supporting role to the insurer in terms of claim settlement. This body obtains a license from IRDA in order to function in the insurance industry.
The third-party administrator knows all the aspects of health insurance plan. The crucial role of any TPA is to approve the claim on the basis of knowledge of coverage and exclusion.
An insurer can either take the route of an in-house claim processing team or there could be a TPA. Policyholders can’t choose between the two.
Functions of Third-Party Administrator:
1. Smooth claim settlement
TPA streamlines the whole process of claim settlement. They facilitate a timely, fair, cost-effective, and hassle-free claim process. It fosters standardization and better delivery of services as per the terms of the policy condition. In the case of cashless hospitalization, they monitor and collect all the required documents from the hospital, all an insured has to do is inform the TPA about hospitalization within 24 hours. They will take care of the cashless hospitalization. He will collect all the bills from the hospital, examine the policy terms, and will pass the claim.
In the case of non-cashless claims, they will settle the amount on a reimbursement basis. All the required documents, the original will need to be submitted to TPA within the due time. Generally, the claim will be passed within one month of document submission. The third-party administrator is the support system of the insurer. It administers all the facts of claims and with expert knowledge, decides to either settle the claim or reject the claim.
Read About: Cashless Claims Vs. Reimbursement Claims
2. Issues health cards to the insured
TPA in Health Insurance policy plays a pivotal role in an insurance contract. It takes care of administration work and creates a database of all the necessary documents of all the policyholders. They issue health-card to policyholders which helps in availing cashless hospitalization. The third-party administrator also helps in disseminating all the crucial information to policyholders. Informing customers about impaneled hospitals i.e. the list of network hospitals. They streamline health care services and cost.
3. 24-hour helpline
A TPA provides a toll-free helpline number to all the policyholders which work 24X7 for customer services. A policyholder can contact them using that number, sitting anywhere in India. Special consultation is also provided from their end. It adds value to the services of TPA and assures policyholders that someone is there to solve their queries.
4. Value-added services.
Apart from the easy and smooth claim process, they provide various value-added services to the policyholder. They arrange various medical services such as ambulances, well-being programs, and customer contact centers. These health facilities aid the insured in case of medical emergencies. TPA services are free of cost and there is no hidden cost applicable in the insurance contract.
Case Study:
Rahul is an employee of XZ Tech. Limited, faced a medical issue at 2 A.M. He was hospitalized. He was not worried about the medical costs since he has a group mediclaim policy. Rahul availed of medical treatment in a network hospital. Hence, the claim was settled on a cashless basis.
Rahul took the following steps for a smooth claim settlement:
- Rahul’s wife sent an email to TPA within 24 hours of hospitalization.
- The respective doctor Rahul filled out the authorization form. This cashless authorization form is available at the TPA’s help desk located inside the hospital.
- He submitted the authorization form to the respective hospital’s help desk.
- The helpdesk will coordinate with the central TPA office.
- TPA office will approve the cashless facility.
The employee should have a valid photo ID proof and a TPA card for a cashless facility. An employee can get cashless claims approved 7 days in advance before admission to prevent last-minute hassles.
The third-party administrator help desk will generate an acknowledgment number which is critical at the time of claim submission.
TPA is the chief support system of insurers. It lowers the burden of the insurer and fosters easier and smoother claim settlement. Before buying the policy, one should know the details of TPA, its claim turn-around time, and its reputation in the market.
About The Author
Pooja
MBA Insurance Management
Pooja is a dedicated professional with 7 years of experience in the insurance industry, specializing in Family Health Insurance. Writing for SecureNow, she offers insightful blogs and articles aimed at simplifying the complexities of health insurance for families. Her expertise ensures that readers gain practical, easy-to-understand advice on choosing the best coverage to protect their loved ones. Committed to making informed decisions accessible, Pooja stays updated on industry trends and developments, providing valuable content that empowers families to secure their health and financial well-being.
