Insurance companies are getting new heights day by day and it is estimated that by the end of 2020 the Insurance sector will ace the finance market of India. The idea of TPA formulation has been taken from the US with few changes made apropos to India’s needs.
What Is TPA?
People always misunderstood TPAs as an insurance company, but no they are different organizations working with insurance companies for hassle-free insurance procedure.
Third party administrator is a link between the insurance company and insured, it has been developed in 2001 to assist insurance company and insured with the claim process. It is an IRDA (Insurance Regulatory Development Authority) licensed organization.
TPA performs cost effective claim settlement with various health insurance companies like star health insurance, Religare health insurance & many more delivers cost-effective insurance facilities to the customer. TPA acts as an intermediary between the insurer and insured to bring ease to the insurance process.
Functions of TPA
TPA plays an inherent part of the insurance system. It ensures an uncomplicated insurance procedure and claim process for the insurance company and insured as well. TPA always has its in-house doctors, the legal team of experts and finance experts to assist policyholders.
Following are the major responsibilities managed by TPA organizations:-
- Hospital Networking – TPA keeps track of best quality service hospitals and collaborates with them for cashless, cost-effective and foremost medical services. TPA makes due diligence for ensuring hospital reputation, authorized medical staff and doctors, proper medical facilities and advanced technology medical equipment. For any filed claim cover against the health insurance policy, TPA contacts networked hospitals and endeavor to start immediate treatment in case of exigency.
- Ease To Access Customer Services – TPA provides 24/7 available customer services to process all queries related to claim settlement, the status of the claim cover, status for reimbursement process just in case if policyholder did not get the treatment from the networked hospital, and strive to quick fix the issues when customers grumble. Informs policyholders via auto-generated emails or SMS regarding any changes in claim status and queries.
- Customer Assistance – Its TPA’s responsibility to process any claim issue within 2 days and collect all the claim related documents. TPA provides complete information about insurance policy within max 7 working days and beneficiate policyholder with guide book and insurance policy information. TPA does not charge anything from the customers for any services. TPA ensures cashless treatment for the policyholder from the networked hospital and if the policyholder is getting medical services from the non-networked hospital then TPA pays the bills and gets reimbursement from the insurance company or provide reimbursement to insured.
- Authorising Policyholders – When providing insurance policy to the customer TPA gathers all the information about the policyholder and the members covered under the policy. TPA maintains the database of customers records and issues an identity card to every policyholder.
ID card issued by the policyholder comprises of following details:-
- Date of policy issued
- Age and name of the insured
- Relationship with policyholder
- Name of the insurance company and TPA
- Contact details
- Unique identification code
- Photograph of insured
- Proceeding claim Settlement – After issuing the insurance policy all the future services and responsibilities comes under TPA authority. TPA coordinates with the hospital management for claim settlement and pays the bill of insured. Proceed claim request of reimbursement of insured, authenticate if the claim request is valid or not, reject and process claim requests in accordance with company policies.
Why an insurer needs TPA?
TPA is well-organized authorities with a legal and professional team.
- TPA assists the insured in case of exigency
- TPA builds hospital networks and expands the insurance system
- TPA authenticate claim request and ensures authenticity