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Medical Bill A TPA sent the claim to its parent company, which repriced the claim, and the TPA administered payment to the provider. No one thought twice about it. (Photo: Shutterstock)

A third-party administrator (TPA) client of ours, and its client (a self-funded health plan governed by state law rather than by ERISA) recently finalized what turned out to be a year-long arbitration process.

This particular TPA is owned by a large insurer. The TPA itself is “independent” in the sense that it’s not an ASO, and has relative freedom to administer benefits as it pleases, but it is nonetheless closely tied to the insurer’s behemoth of a network, and its groups therefore incur very few out-of-network claims. This, of course, reduces member noise to a negligible level, which is ideal, but the network rates are always arbitrary, and often the discounts are small (but that’s another story for another day).

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