EP436: Let's Talk About TPA and Health Plan Inertia Instead of Jumbo Employer Inertia, With Elizabeth Mitchell

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May 16, 2024

Elizabeth Mitchell from PBGH discusses the gap in the market for independent TPAs not owned by health plans, emphasizing the shift towards direct contracting between employers and providers. The conversation highlights the need for efficient and unbiased TPAs to improve access, quality, and outcomes in healthcare.

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INSIGHT

Gap In The Market For Indie TPAs

A gap exists: employers need independent TPAs that simply pay claims, provide transparent data, and negotiate contracts.
Health-plan-owned TPAs tend to become health plans and add unwanted services and opaque fees.

INSIGHT

Money Lost In The Middle

Employers spend huge sums yet value (quality/cost) is declining as money gets lost in intermediaries.
Primary care investment is shrinking despite employers wanting more prevention and access.

ADVICE

Pursue Direct Contracts With Providers

Employers should pursue direct contracting with providers to achieve better access, outcomes, and 10–30% total cost reductions.
Use clear quality metrics, payment levels, and monitor performance actively.

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In this episode of Relentless Health Value we follow up on the topic of employer inertia discussed with Lauren Vela in episode 406, turning our focus to third-party administrators (TPAs), administrative services only (ASOs), and health plans.

Elizabeth Mitchell from the Purchaser Business Group on Health (PBGH) joins us to discuss the roles of TPAs and ASOs, highlighting the gap in the market for independent, efficient TPAs not owned by health plans. We also delve into the trend of direct contracting between employers and providers to enhance access, quality, and outcomes.

Bottom line, right now, there's a gap in the market. What is needed are indie TPAs who are effective and efficient and not owned by a health plan because, if history is any predictor of the future, the second the TPA gets owned by a health plan, the TPA sort of ceases to be a TPA and becomes a health plan.

The conversation today with Elizabeth Mitchell pretty quickly gets into the shift toward direct contracting between employers and providers to improve access quality and outcomes. If you can't beat them, get ruthlessly practical is my takeaway. I have to say, I truly admire some of these HR folks and their leadership willing to do what it takes on behalf of protecting the people that work for them.

There are certainly some health plans at least trying here, so I don't want to imply otherwise. There are some interesting initiatives that are afoot at, I'm gonna say, usually regional health plans. Elizabeth Mitchell has talked about some of these and made this clear also elsewhere.

Join us for a deep dive into these critical components of the healthcare system and their impact on self-insured employers.

=== LINKS === 🔗 Show Notes with all mentioned links: https://cc-lnk.com/EP436

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