We could all use a helping hand. That’s especially true for employers. The day-to-day demands associated with compliance and benefits management has been a headache for employers time and time again. For as long as employers have had that headache, TPAs have been stepping in to help. In this blog, we’ll get into the basics, the must-knows, and the benefits of a TPA!
What is a TPA?
The obvious starting point is a more complete explanation of a TPA. A third-party administrator, or TPA, is a separate entity that provides an array of operational services for employer-sponsored group health plans and benefit trusts such as receipt and reconciliation of premium contributions, claims administration and employee benefits management.
An alternative to a full-suite of administration services, is the option of an ASO, or “administrative services only.” The uniqueness of an ASO business is that the ASO is generally not involved in the benefit selection and is often a preferred option for government contractors that don’t offer health insurance products to employees, but still need certain services, such as paid leave accounting.
As the parent company of both a licensed insurance agency and a licensed TPA, Boon tailors our benefit solutions to the specific needs of each client. We have the expertise to advise on self-funded arrangements, and also work with several carriers so that each employer solution is crafted through a consultative approach married to decades of experience in the niche field of fringe benefits for government contractors. We also provide ASO solutions, when beneficial to the client’s specific needs.
Why Government Contractors Turn to TPAs
Many government contractors have benefited from the cost savings associated with offering fringe benefits. For government contractors, paying the fringe amounts into a bona fide benefit offering in lieu of paying the fringe amounts in cash gives a cost-savings advantage to the contractor that provides leg up over the competition.
Managing the fringe contributions requires expertise. Furthermore, it takes labor and resources to properly track and account for fringe dollars at the individual employee level. The level of work required to maintain compliance can be overwhelming.
The Benefits of Boon
A TPA understands the intersecting worlds of benefits and health insurance, as well as the industries its clients work in. A TPA has the expertise to monitor and advise employer-sponsored benefit plans for continued compliance with the ever-changing laws and regulations.
At Boon, we are experts in the government contractor space. Boon’s robust in-house services have cemented our reputation as an industry innovator. We pride ourselves on offering the very best solutions for our clients. Our services include hour bank administration and paid leave accounting, consolidated billing and allocation of the premium, COBRA administration fringe contribution collection, audit trail accounting and more!
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