It is common to come across terms such as TPA and in-house claim settlement while buying insurance. They are organizations in the field of insurance who help you with various tasks such as the claim settlement process of the individuals, claim-related issues, and any other related grievances.
Read: TPA and their role in insurance
A Third-Party Administrator (TPA) is an IRDAI-approved healthcare service provider. TPA helps in providing access to network hospitals, timely claim settlement and cashless hospitalization. Whereas, an in-house claim settlement is set up by the insurers within their company for the same tasks. An insurer can either have a TPA or a in-house team for the above-mentioned tasks.
Read: Health Insurance Claims Process - Cashless & Reimbursement Claims
Before getting your group health insurance policy, it is important to understand what TPA and in-house claim settlement mean and what are its pros and cons.
Let us first understand what is TPA in insurance and in-house claim settlement are by the following descriptions.
Third-party administration (TPA)
Apart from being licensed by the IRDAI, TPAs are also licensed outsourcing entities chosen by a specific health insurance provider. TPAs issue health ID cards to policyholders to avail of cashless claim benefits. The policyholders are also assisted with reimbursement claim settlement procedures by TPAs. In short, TPAs are nothing but a third party who helps the policyholders settle their claims and reimbursements without any hassles.
Here’s what TPAs typically do:
- Issue health ID cards to policyholders, which are required to avail of cashless hospitalization at network hospitals
- Assist with reimbursement claims, helping employees and policyholders submit bills, documents, and follow up on claim status
- Act as a liaison between hospitals, insurers, and policyholders, ensuring smooth communication during health emergencies
- Support policyholders with pre-authorizations and claims-related queries
Read: Convalescence benefit in group health insurance
The in-house claim settlement process
An in-house claim settlement department or Health Administration Team (HAT) is an entity set up within the insurance company for only its customer-centric functions. The in-house claim settlement department has the same function as that of the outsourced TPAs. The job of the inbound claim settlement department is to provide a hassle-free claim settlement experience and solve any grievances of the policyholders of the insurance company without any delay.
TPA vs in-house claim-settlement process
The following table depicts the difference between TPAs and in-house claim settlement
The above differences are explained below elaborately-
In-house claim-settlement has better services
As the in-house claim settlement exists within the company and deals with their personal clients only, it allows them to provide special offerings including ease on the claims handling front, lower Turnaround Time (TAT), etc. Additionally, this in turn helps them stand in the competitive space in the market.
TPAs are more flexible than in-house claim-settlement
In the case of TPAs, flexibility comes first. TPAs provide cashless claims in planned and unplanned hospitalization. In case of any grievances, all you need to do is submit the relevant documents and bills to the TPA and they carry forward the process to get your claims settled. Whereas in-house claim settlement, flexibility goes at stake as one has to get involved in the process which makes it more tedious.
TPAs have a wider range of network hospitals
TPAs cover a wide range of network hospitals as compared to an in-house claim-settlement department. An in-house claim-settlement department functions for a particular insurance company, so naturally, their list of network hospitals is lesser compared to a TPA. Having a long list of network hospitals allows a greater extent of coverage for cashless treatment.
The in-house claim-settlement department resolves queries and grievances
As an in-house claim-settlement department has fixed customers confined within the insurance company, it gets easier to resolve any queries or grievances related to the respective processes. Whereas, TPAs don’t provide such facilities to resolve any queries or grievances.
Examples of TPA and in-house claim settlement
Below are some of the TPAs under IRDAI and in-house claim-settlement companies in the market.
Examples of insurer with in-house team and their claim-settlement ratios
Why choose Pazcare to get your group health insurance policy?
If you’re looking for the best company for your group health insurance, Pazcare is the one! Pazcare provides employee healthcare benefits built for the modern workforce. Pazcare's ultimate goal is to make insurance simplified for HRs. Our dashboard and app is equipped to handle tasks like endorsements and reports without depending on TPA. It also makes it easy for HRs and employees to get all their policy information in one place. No more calling your TPA for insurance details!
With Pazcare, you can choose tailor-made group health insurance along with health and wellness programs. Apart from the plans, we provide 24*7 customer support for claims and provide a dedicated SPOC(single point of contact). We also provide add-on benefits like discounts on medicine, free wellness activities, and much more!
With Pazcare, You Get the Best of Both Worlds
At Pazcare, we simplify the health insurance experience, regardless of whether your insurer uses a TPA or in-house team.
Want to know which claim model your insurer follows?
Talk to our team for free claim guidance and support.
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