This is another great question that comes up often! When moving to self-funding, the responsibility for plan administration does shift from the insurance carrier to the employer – but that doesn’t necessarily bring a lot of extra work in-house.
That’s because most employers choose to partner with a third party administrator (TPA) who will assist with the entire claims review/management process. This is typically where the bulk of administration work originates in a self-funded plan. Here’s why: monthly claims can have significant savings potential, so it’s important to scrutinize the bills received instead of taking a quick, turnkey “process and pay” approach. Reputable TPAs will have dedicated claim analysis programs and staff in place to review claims and identify any pricing discrepancies or other problem areas. Their teams can take on the work of assessing charges, ensuring claim accuracy, submitting payments in a timely manner and following up when charges are incorrect.
Membership support is another administrative need, but fortunately, many TPAs (Cypress included) have moved to online platforms that simplify and streamline these functions. This makes online enrollment possible, and it also gives members 24/7 access to their benefits information. It minimizes paperwork processing/filing as well. Having a web-based system helps with customer service, too – if members can easily find answers to their questions, it can reduce the volume of phone inquiries received.
There are administrative needs to consider when moving to self-funding, but most can be seamlessly managed when employers team up with an experienced, full-service TPA.