The Leading Business Education Network for Doctors, Financial Advisors and Health Industry Consultants

Mid-September 2010 Edition

By Douglas B. Sherlock, CFA

In this edition of Plan Management Navigator, we summarize on the results of selected TPAs. Administrative expenses for core services of selected TPAs were 84% of fees in 2009. This was $11.56 per employee per month (PEPM) or $6.06 per member per month (PMPM). Core Medical product costs were $25.28 PEPM and $11.56 PMPM.

Elite Performers

While the universe of participants was small, at 5 TPAs, the surveyed TPAs may be elite performers. Function-by-function, these TPAs had lower costs than are typically found in competitive products of Blue Cross Blue Shield and Independent/ Provider-Sponsored plans.  They are also typically among the largest 20% of TPAs. Finally, they have accounting systems sufficiently robust to report with the granularity of the Sherlock survey. This may be an indicator of strong management if “you manage what you measure.”

Sherlock Expense Evaluation Report

The summary in Navigator is excerpted from the 2010 TPA edition of the Sherlock Expense Evaluation Report, which is now available to licensees and participants.

Web Conference 

We will host a web conference on Wednesday, September 22 from 2:00 PM to 3:00 PM East Coast Time to discuss the summary results. Doug Sherlock will offer a brief presentation, followed by questions and answers. To participate in the web conference, please register at https://www2.gotomeeting.com/register/ 933935259. Once registered, dial-in information and a link to connect to the web will be provided in a confirmation email. Please note that if more than one person from your firm would like to participant in the conference call and everyone will be in one room, only ONE person needs to register for the conference. 

Assessment

Thank you for your continued interest in our research.

Link: Mid-September 2010 Navigator 09-20

Sherlock Company
sherlock@sherlockco.com
Ph:  215-628-2289
Fax: 215-542-0690

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Filed under: Health Economics, Healthcare Finance, Research & Development | Tagged: Blue Cross Blue Shield, CFA, Douglas B. Sherlock, Plan Management Navigator, Sherlock Company, Sherlock Expense Evaluation Report, TPA |