The complexities of administering an effective self-funded plan require an expert third party administrator (TPA). However, to get the most value out of your self-funded strategy, requires the implementation of a benefits solution, one that takes into consideration the multiple manners in which risk, and costs, can be mitigated. When evaluating prospective benefits administration partners, a network discount comparison is usually the first step. Too often, however, it is the only tool used to select an administration partner. What follows is a list of 11 key attributes to look for in a strategic benefits administration partner:
Unlike fully insured health benefit plans, a self-funded model offers organizations the ability to fully customize programs in order to meet specific needs and goals. While insurance carriers may claim to provide full customization through administrative services-only (ASO) arrangements, they are typically restricted by systems that only process claims for pre-determined products, and do not allow for true customization.
2. Strategic Account Management
While cost is a primary indicator of success, the effectiveness, or lack there in of, of the account management team is often the underlying reason organizations issue an RFP. When evaluating benefits administrators, be sure to understand the level of strategic guidance and service support you will receive. The ideal administrative partner will deliver an account management team that has years of industry experience with the ability to build a strategic engagement plan that emphasizes the following: corporate and solution objectives, cost-drivers, recommendations, ROI measurements, and coordination of solution services.
3. Advanced Analytics And Reporting
Having access to claims and clinical data is essential to making educated plan decisions. Experienced benefits administrators will invest in advanced technology that produces fully customized, easily accessible reports, that can stratify and aggregate data to provide detail on a multitude of plan aspects including:
- Cost drivers and large claimant impact
- Utilization and key performance indicators
- Clinical data
- Medical management
- Population health management
- Prescription drugs
- Network utilization
- Provider performance
4. Population Health Management
Over the past decade, implementation of population health management (PHM) programs have been on the rise as organizations have not only looked to reduce health plan costs, but to differentiate themselves from an employee recruitment and retention perspective, improve morale, and reduce absenteeism. Expert benefits administration partners have recognized that the most effective PHM solutions don’t rely upon a string of non-cohesive, individual wellness services, but require a comprehensive solution that leverages benchmarks to assist the organization in reaching full wellness maturity.
5. Provider Network Expertise
A truly strategic benefits administrator partner will offer services beyond regional and national network development. While many benefits administrators lease networks at an additional cost, those with their own proprietary network and on-site network development experts will offer the most value. Internal network experts can assist with custom network development — a cost-saving strategy for plans able to steer member utilization patterns. A strategic partner with network management expertise will analyze your claims data and recommend unique plan designs that drive members to preferred partners, using a tiered benefit structure. This type of customization in a self-funded strategy allows for strategic partnerships with valuable local providers.
A self-funded cost containment strategy should focus on mitigating unnecessary plan payments, like those from provider billing practices, rather than simply denying services or shifting costs to members. A medical record review can achieve significant savings by identifying instances when a service was incorrectly coded — resulting in a higher charge — or when protocols set out by the plan were not followed. It can also uncover billing fraud and abuse in the process of flagging inappropriate services. The success and thoroughness of these steps will set a valuable benefits partner apart from a typical TPA.
7. Diversification of and Integration of Services
A comprehensive benefits solution should contain a variety of additions to core plan elements, including medical, dental, and/or vision plans; consumer-driven health plans; workers’ compensation and disability plans; case management; population health management programs; pharmacy integration management; employee benefit statements; online enrollment; back-office administrative support and more. A benefits partner with the industry expertise and technology to integrate the administration of these services not only streamlines administration from an employer perspective, but optimizes overall cost control and helps ensure proper fund management.
8. Member Engagement
It can be argued that the ability to fully customize plan design is self-funding’s most powerful benefit; and while this may be true, full customization makes it more complex to achieve high service levels. Since no two self-funded plans are alike, customer service representatives must have extensive knowledge of varying plan designs and translate the intricacies of plan documents to customers accurately. A thorough understanding of the benefit administrator’s claims training process, as well as a review of key customer service performance indicators, will provide insight into the quality of service your members can expect to receive.
9. Compliance Expertise
Since the ACA was implemented, organizations rely on their administrators to educate them on the various, ever-expanding health care reform laws, to ensure their decisions are both beneficial and compliant. Benefit partners with internal compliance departments have shown a more thorough understanding of the ACA and its implications. For general plan compliance, an internal compliance team offers more immediate access to information, and often engages in direct and consistent communication with your organization without incurring ad-hoc consultative fees.
10. PBM Management
Choosing a self-funded plan not only allows you to choose your administrative partner, but also your pharmacy benefit manager (PBM). Like selecting a benefits administrator or carrier, selecting the right PBM for your organization will ensure that the PBM’s administrative experience and service offering capabilities are aligned with your corporate and benefit plan goals. A strategic benefits partner will help you select the right PBM to administer your prescription drug plan. Ideally, you should be offered aggressive, negotiated contracted rates with more than one PBM, as well as an integrated service model with such benefits as a single member identification card, integrated reporting, case management coordination, and eligibility file sharing.
11. Stop Loss Reinsurance Administration Expertise
For many self-funded plans, but especially those for less than 1,000 employees, adding a level of stop-loss reinsurance protection can help protect your budget from unexpected catastrophic claims. All benefit plans, both fully insured and self-funded, experience catastrophic claims. A strategic benefits administrator will have relationships with a variety of stop loss carriers that have A+ ratings to ensure plan sustainability, and will be able to guide you to identifying the appropriate levels of specific and/or aggregate coverage for your benefit solutions and provide recommendations as to the deductible threshold, protection terms, and contract length that will best protect your benefit solution.