Are HMO and insurance company operating ratios comparable?
No, and would probably cause a TPA & clients into serious legal & market problems. Why? TPAs give much more personalized service and find that they need to provide much more specific government compliance implementation service. Government compliance is the biggest threat and cost to clients. One of the major reasons for the phenomenal growth in TPAs is that TPAs have earned a reputation for not only keeping up with the latest twists and turns, but also taking the time to help the client understand and apply it to their situation. Remember that every claim processed requires a certain amount of government compliance review to avoid later headaches & fines. To be competitive in the TPA marketplace, that is expected. (It is not purely altruistic. TPAs have taken this pro-active role, because they have seen that if the client gets into a mess, it is the TPA who has to use uncountable hours to clean it up, so the large time/staff investment in government compliance is actually an efficienc
