Tips for Pitching to TPAs
The success or failure vendors have with TPAs is usually determined by the level of true understanding the vendor has about TPAs, their relationship with clients and the legal/regulatory environment in which they operate. Start with "Everything You Wanted to Know About TPAs But Were Afraid to Ask," which includes some specific tips for vendors. Then review other sections to get an understanding of the TPA role, information about payment, ERISA fiduciary duty and laws such as health reform.
Four reality checks:
- TPAs and SPBA are often approached about the most amazing concept/service/product every TPA and client plan would want and need. Of about 200 such sure-problem solvers over the years, none have ever lived up to the hype. TPAs appropriately are cautious or skeptical.
- If a vendor confuses a TPA with an insurance company’s role and needs, the relationship will sour. Know the TPA and its markets!
- It is better to proceed with a focus-group collaborative approach. Often the TPA can save the vendor serious embarrassment by pointing out that the idea would be breaking federal law. Brainstorm, listen and learn.
- ERISA fiduciary law and the TPA service-provider role (unlike an insurer who profits from lower claims) is different, and therefore, the pricing should be customized to reflect this.