Getting Behind the Scenes: Who’s Really Paying You?

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By Judith Otto

How do you know if your PPO (preferred provider organization) has been rented by a TPA (third party administrator, also called a TPO, or third party organization)has been rented by a TPA? Is the MCO (managed care organization) or TPA delaying in providing you with a client list--or even refusing to do so? What should you do? The O&P EDGE asks the experts.

Are the MCOs/TPOs being purposely obscure in delaying or refusing to provide lists identifying insured groups covered under your provider contract?

"No," says Alison Cherney, Cherney & Associates, Brentwood, Tennessee. "They're just very confused and their information systems are really poor. They haven't invested a lot of money in updating their communications. Providers simply need to be tenacious and keep asking for such lists."

Keith Senn, chief operations officer, Center for Orthotic and Prosthetic Care, Louisville, Kentucky, and a former associate executive director for Humana, points out that although there's no reason for an MCO to hedge or delay in providing a list of clients and a directory of employers who are contracted with them, it may be advantageous to a TPA or TPO to be less forthcoming with this information.

"They [TPAs] are in the business of leasing their network to anybody-which makes it even more essential that we need to know WHO is in their network. If providers see how many of our existing contracts are duplicated on the TPA's client list, with possibly conflicting reimbursement rates, we might complain or even refuse to sign an agreement with them."

And if they can't or won't show you their client list, be very wary, Senn warns-and look very carefully at what benefit(s) the TPA can deliver. "Be sure you need them," he advises, "before signing with them."

Cathie Griffith, PrimeCare O&P Network, Ellendale, Tennessee, observes that even when client lists are provided, a certain amount of confusion remains. "In many cases we get lists from the TPOs, and our providers say they have never heard of these companies. This is because each employer group may be listed without identifying the insurance company they use. For example, the contract with the TPO may be with Blue Cross/Blue Shield, but our list may include the names of only the individual companies insured (e.g. Wanda's Widgets, Bob's Battery House, etc.), and may not identify BCBS at all.

"Ideally, in this situation, when a patient works for one of the companies identified on the TPO client list, he/she should come in to a provider's facility with a BCBS card that has a sticker noting that the administrative contact is through Ted's Terrific TPO," Griffith continues. "

How do you know if your PPO has been rented by a TPA?

"Ask them," says Cherney. Unless you put it in your contract that they have to notify you, your PPO can be so rented at any time without your knowledge, she explains.

"Most contracts are written by the payer and are very one-sided. As a small company, you have to ask them whether or not they notify you if and when a TPA enters the picture.

"If you think about the way the business is set up," she adds, "a PPO is a network of providers. That's a separate business. They have to do credentialing of providers, make sure they have the right geographic service areas in place-there's a lot of human resources management involved with that side of the business. TPAs have been around forever, and they're really on the claims or billing collections side of the issue.

There are thus two major pieces of putting a whole contract together: the billing and collections side and the human resources side, Cherney says. "So the TPAs rent networks and providers: hospitals, doctors, O&P, you name it-that's their business, while the PPO may be renting out different things to different people. It's not typical that they'll then have different rates for the TPA; they're generally not going to do that-change your contract. If they've got a particular contract for O&P, they'll generally go with that to the TPA. It's so small, I doubt the TPA would even ask that question."

This, then, is another case where it is wiser to do due diligence in the beginning, and make sure your contract protects you against any such manipulation.

Judith Otto is a freelance writer based in Holly Springs, Mississippi.