I’m doing some work with a 3rd-party insurance administrator (“TPA”). In this business, we have the TPA actor, some number of employer (“ER”) actors, and some number of employee (“EE”) actors. ERs supply their EEs with certain insurance, often from a menu, and EEs pick which insurance they’re going to carry. There are deals between the ERs and the EEs as to how much of each insurance, if any, will be paid for by the ER, and how much by the EE. The EEs let the ERs know of their picks. That can leave each EE with a number of insurance policies, such as medical, dental, vision, life, & 7 other types. The ERs don’t want to have to deal with the carriers, so that’s where the TPA comes in. The TPA takes the information from the ERs, and gets the appropriate information to the carriers. The TPA presents each ER with a single bill each month. The ERs pay the bills to the TPA, who then distributes the money to the carriers as appropriate. The carriers thus don’t need to deal with the ERs or, for the most part, the EEs, and thus pays the TPA for dealing with this.
That’s complicated enough, but there’s something else called Cobra. An otherwise terminated EE or dependent can elect to maintain coverage that they already had (for certain types of coverage) at a slight extra cost, typically 2%, but in some circumstances as high as 20%. The employers can administer Cobra accounts, or the TPA can, or the carrier can.
That’s the background. In this particular case, the TPA’s Cobra administrator came to me and asked me to help automate a particularly cumbersome circumstance. In this particular circumstance, the TPA administers the enrollments for employer X at the carriers, but does not administer the money. However, for employer X’s Cobra offshoots, the TPA administers both the coverages and the money for those coverages.
As I said, the administrator asked to have the process automated. I was given a brief description of what happens. After observing the process, here’s what I saw happening:
Employer X has offers medical plans A, B, and C to its employees (and thus Cobra members). When an employee is to be added, the TPA goes through these steps:
• Add the employee on plan A, B, or C.
• Do a “letter run”, so that “welcome” letters go to the EEs.
• Do a “carrier report run” so that the EEs are reported to the carriers.
• Move the EEs from plans A, B, and C to “fake” plans A’, B’, and C’, which don’t bill or pay (before billing happens).
When an employee leaves employment, the TPA goes through these steps for employer X:
• Move the employee from plans A’, B’, or C’ to plans A, B, or C.
• Do the termination.
• Do a letter run so that Cobra offer letters go out.
• Do a carrier report run so that the carrier can see that the coverage has been cancelled.
• Switch the EEs back to plans A’, B’, or C’.
When an ex-employee moves to Cobra coverage, this happens for employer X:
• Move the employee, to plan A, B, or C.
• Transfer the ex-EE to Cobra.
• Again, show the ex-EE as having been on plan A’, B’, or C’ for the ER’s purposes.
Here’s the specific TPA request: Specify 3 screens so that these 3 processes can be done as single automated requests.
That’s not at all what I did. Can you figure out what I did and why?