Understand the Role of TPA in Health Insurance

What is TPA in Health Insurance?

Ever faced a situation for an emergency hospitalization of any dear one? Though bitter but it is a hard and unavoidable factor of our life. At the time of accidental happenings or mishaps that need immediate hospital care, you rush for medical aid. Those who have an insurance policy can breathe a bit but those who don't can face a financial crisis.

We have insurance companies to buy a health insurance cover. But we have a TPA i.e. a Third Party Administrator to fix problems related to the health insurance claims. So as soon as any individual is admitted to the hospital an intimation of the same is given to the TPA.

For you to understand the role and application of a TPA, let us gather some more insights about it.

What is a TPA?

A Third Party Administrator is a body that processes insurance claims admissible under the mediclaim policy. In general,these administrators are independent but can also act as an entity belonging to the insurer/s. These bodies are licensed by Insurance Regulatory IRDAI.

Over the years, the number of insurers, health policies sold, types of health products and the buyers increased in considerable proportion. Ultimately, it got difficult to keep track of work which did not result in quality services. Hence, IRDA came up with the Third Party Administrators. Since then, a TPA is held responsible for:

High quality consistent services.
Processing voluminous health insurance claims.

Relevance of TPA

A Third Party Administrator will take care of the hospital bills and other expenses. While you are distressed with the illness of a family member or friend, you can just take care of them. The rest will be handled by the TPA.

Every insurance company appoints a TPA for your service. You do not have to pay directly to the administrator. A TPA can either approve of a cashless claim settlement or reimburse it later. But in no case of complaint or query, will the health policyholder directly connect with the TPA.

For an insured, the connection will always be between them and the insurer only. To summarise we can put it across that TPA is relevant to:

Share immense knowledge of healthcare services.
Improvise the quality of services.
Manage and Investigate the claims.
Observe the Cashless and Reimbursement TAT.

Important: Learn more about the benefits & what's covered in COVID 19 Insurance in India

What is the Role of TPA in Health Insurance?

A TPA plays a vital role in the total processing of health insurance claims. In the practical world of insurance, some of the jobs of a TPA may refer to the following kind:

Issue the Health Cards to the insured

For every policy issued to the policyholder, a validation procedure is carried. It is accomplished by issuing an authorized health card. This card holds the detail of the policy number and the TPA which is held responsible for claims processing.

At the time of admission to the hospital, the insured can produce this card and intimate the occurrence of the claim either to the insurer or TPA. It is one of the essential documents needed for claim processing.

Smooth Claim Processing and Settlement

A TPA is responsible to expedite the claim as soon as it is intimated by the insured. Their job is to check all the documents submitted in favor of the claim. It can ask for as much information as is needed to cross verify the details. The settlement of the claim will either be on cashless or on a reimbursement basis.

Whichever be the case, a TPA will be liable to check for all documents. In the case of Cashless, the TPA can collect the documents from the hospital. In other cases, the TPA can ask for the supporting papers and bills from the policyholder.

Arrange for Value-Added Services

Other than the claim processing and card issuance, a TPA also arranges for other services like ambulance, well-being programs, and others.

Helpline Facility

All the policyholders can access the information and other assistance for claim calling their TPA. This facility is available 24X7 for customer service and it can be called from anywhere in India. The policyholders can know the status of their claims also via the toll-free number, 1800-258-5956.

Strengthens the Hospital Networks

A very essential element to take the benefit of the health insurance policy is to have a TPA. It further builds a strong network of hospitals where the policyholders can take the treatment. The TPA tries to enlist the best hospitals that can quickly arrange for cashless and allows the negotiation of the rates.

How TPA helps Policyholders?

A TPA is an intermediary between the insurance company and the policyholder. Their job is to simplify the claim procedure under health insurance policies. As we know there can be two kinds or types of claim: a) Cashless and b) Reimbursement.

As soon as there arises the need for a medical or emergency treatment, the policyholder visits a hospital. If the individual is asked for hospitalization for a minimum of 24 hours (for unless otherwise listed diseases like cataract) a claim becomes admissible.

The policyholder, in this case, will intimate the TPA or the insurer about the admission and the need for the treatment. The TPA will then ask the hospital to arrange for cashless facility, if possible. Otherwise, the claim will be processed for reimbursement. After the treatment gets over, the hospital will send all the bills to the TPA if cashless is approved. If not, then the policyholder will have to submit the documents later.

The authorities at the TPA will scrutinize the bills and other documents post which the settlement of the claim will be allowed. In case of cashless, the payment will be made to the hospital. But for the reimbursement, the expenses will be received by the policyholder via the insurance company.

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Disclaimer #1: *Customer can choose options at the time of availing insurance. Premium amount may vary accordingly. Insured is required to disclose any pre-existing condition or on going treatment before policy issuance in the proposal form.

Disclaimer #2: This information is added only for informative purposes and collected from different sources across the Internet. Digit Insurance is not promoting or recommending anything here. Please verify the information before making any decisions.