Third Party Administrators (TPAs) play in a big role in assisting self-funded plans to maintain compliance with their employer responsibilities.
The first essential service that TPAs provide is aiding in determining the creditability of Medicare Part D coverage. This determination is critical as it impacts the plan's compliance status under Part D rules. Without TPA assistance, employers may face the complexity of engaging actuaries or attempting the simplified determinations, which can be far from straightforward.
The second area where TPAs prove their worth is in facilitating the calculation and payment of PCORI fees. Employers must pay these fees to the IRS by July 31st if they operate a self-funded plan (or a fully-insured plan with an HRA). TPAs simplify this process by providing accurate covered lives counts through approved methods, enabling employers to fulfill their fee obligations efficiently.
Lastly, TPAs assist self-funded plans in navigating the evolving landscape of regulatory requirements under the Consolidated Appropriations Act (CAA). This includes compliance with MRFs: machine-readable files, the No Surprises Act, mental health parity determinations, and ensuring network contracts are free of gag clauses. TPAs also play a crucial role in coordinating RxDC submissions to CMS by the annual deadline of June 1st.
TPAs play a vital role in shouldering the technical and administrative burden faced by employer-sponsored Group Health Plans with self-insured arrangements. By using the expertise of TPAs, plan sponsors can navigate complex compliance requirements with confidence and focus on delivering high-quality healthcare benefits to their employees. Make sure to use your partners - TPAs and otherwise - to help your employer clients win with a self-funding strategy.Â
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