Third-Party Administrator ClaimLinx

What Does a Third-Party Administrator Do?

ClaimLinx is a full-service insurance company. We take care of anything and everything, such as finding the best possible employer-paid benefits and competitive health insurance rates. But at the core of the ClaimLinx Solution our consultants use, is the third party administration we offer employers. Today’s blog from ClaimLinx explains what a third-party administrator does for businesses.

Definition of a Third-Party Administrator

A third-party administrator accepts and processes medical insurance claims from healthcare entities and patients. Think of this as a service that makes sure everyone’s paperwork lines up with what’s covered, what’s not, and who pays what in terms of health insurance coverage. They connect and communicate among health insurance providers, employers, healthcare companies, and people who file health insurance claims for payment. Third-party administrators are experts in their field, and they typically only work with insurance.

Related Post: See ClaimLinx’s Complimentary Elite Services for clients

Duties of a Third-Party Administrator

Many employers choose to self-fund employee healthcare plans, and technology makes it possible to streamline payments to healthcare providers. However, a third-party administrator takes the hassle out of this process. ClaimLinx ensures everyone fills out the proper forms and that each participant receives the right amount of money. Employers and employees log in to our convenient online system to see their forms, claims status, and finances on a health insurance plan. Our team reduces paperwork and educates everyone on how to file claims for coverage.  

What ClaimLinx Does

ClaimLinx accepts claims from employees and providers and processes them to determine the correct payout for the employer and the member. We keep track of each client’s custom schedule of benefits and each member’s usage. Meaning we track who has hit their deductible and through which claims. All of that data lets our team help when it comes to finding new ways to save. Our system works for medical, prescription, dental, and vision coverage. We process claims and payments to providers and members while following strict HIPAA guidelines for privacy. Our team works for you, not for insurance companies. With Claimlinx as your third-party administrator, you and your workers are our top priority.

Related Post: What is an employer-sponsored, or self-funded, plan?

Hire ClaimLinx as a Third-Party Administrator

ClaimLinx does so much more than serve as a third-party administrator. We offer the security and convenience of all of your healthcare resources in one platform. Our employer benefits consultants teach employees how to take full advantage of their health insurance. Contact ClaimLinx or call toll-free 1-800-858-1772 to find out about the ClaimLinx Solution for your small business.

ClaimLinx Health Insurance Benefits Consultant

ClaimLinx Glossary: Secondary Coverage

You offer fantastic health insurance for your employees. It gives them peace of mind for themselves and their families in case they have expensive medical bills. However, the plan couldn’t possibly cover every single type of high-tech MRI scan, prescription medication, or medical procedure. Then secondary coverage comes into play. ClaimLinx explains precisely what secondary coverage is, and how it can save your employees money on their healthcare costs.

What Exactly Is Secondary Coverage?

Simply put, secondary coverage is any health insurance plan that supplements your main plan. Your primary plan usually comes from your employer. ClaimLinx uses secondary coverage as a way to restore good benefits to employees. One of the first steps in using the ClaimLinx Solution is to raise the deductible on the primary plan in order to lower premium costs. But that means employees would have to shoulder most of the costs for office visits, prescriptions, testing, etc. A secondary plan can pay for the medical expenses not covered by your primary plan. This is why secondary health insurance represents a vital tool for helping employees pay for health care. The ClaimLinx Solution sets up a custom secondary plan for your employees, called an employer-funded medical expense reimbursement plan (MERP)

Related Post: What is the difference between primary and secondary coverage?

How Does Secondary Coverage Work?

A primary plan pays money directly to healthcare providers while you pay the balance. Secondary coverage pays you directly to reimburse you for expenses not covered by the primary plan. Or secondary coverage can also pay medical providers directly so employees don’t have to. For example, your primary plan covers 60 percent of the costs of an MRI, and you receive a bill for $1,000 for the scan. You must pay the $400 not covered by the primary plan. Your secondary coverage would pay part or all of that $400. The added benefit with ClaimLinx is that employees experience seamless administration. They don’t have to worry about paying that $400 up front. They arrive at the provider’s office with a custom ID card with benefits listed. ClaimLinx then takes care of the rest.

What Does Secondary Coverage Pay?

Secondary coverage might pay for medical care not covered by your primary plan, including eyeglasses or visits to the dentist’s office. A secondary plan may cover copays and coinsurance to help alleviate the costs associated with the primary plan. Some secondary coverage specializes in paying for expenses related to accidents, critical illnesses, cancer, long-term care, and disabilities. ClaimLinx’s Solution aims for employees to receive the same benefits as an expensive plan from a major carrier. Secondary coverage can pay for that, but at a much lower cost.

Related Post: What is the ClaimLinx Simple Option Solution?

Why Have Secondary Coverage?

The average person in the United States spends $10,739 per year on healthcare. Secondary coverage can help you spend less money on healthcare, which may insulate your finances from high medical bills. Consider a secondary plan if you know you’ll have high medical expenses in a given year. The ClaimLinx Solution finds the best way for employers to save money while giving workers a great employer-paid benefit.

ClaimLinx and Secondary Coverage

ClaimLinx can save companies as much as 40 percent on health insurance costs. Contact ClaimLinx or call toll-free 1-800-858-1772 to find out what we can do for you.

MERP ClaimLinx

ClaimLinx Glossary: Medical Expense Reimbursement Plan (MERP)

A medical expense reimbursement plan (MERP) is part of the ClaimLinx Solution. A MERP allows business owners to make a tax-deductible contribution to employees’ medical expenses. Our employer benefits consultants combine a high-deductible health insurance plan from a national carrier with a MERP. This arrangement gives both workers and owners an optimal choice for health insurance benefits. Today’s ClaimLinx blog defines and explains how a MERP works with regards to health benefits.  

Short Definition of a MERP

A MERP lets business owners deduct any portion of medical expenses paid by the company or employees for their medical care. The idea is to reduce the out-of-pocket expenses that employees pay for medical care before health insurance starts to cover the costs. Contributions to these costs lower the amount of money the IRS calculates for a business’s income taxes. ClaimLinx helps you find the optimal funding levels for MERPs to give you the best way to provide health insurance for workers.

Related Post: Why did my employer purchase a MERP?

Example of How a MERP Works

Suppose ClaimLinx has determined a plan with a $3,500 deductible works best for your company. That means the employee would normally pay $3,500 before the health insurance coverage starts paying for his or her medical care. A MERP can help lower someone’s up-front costs for medical care. ClaimLinx designs a custom schedule of benefits for you and your employees based on medical needs and company budget. In this case, the employee would actually have a much lower deductible and may even experience copays for regular visits and procedures. Business owners receive the tax deduction only when an employee has a qualified medical expense when they pay part or all of the medical expenses.  

Why Employers Need a MERP

All the time, employers tell ClaimLinx they would not be able to have viable health insurance benefits without a MERP. Small businesses often have slimmer margins and can’t afford good benefits when premium costs go up. MERPs allow employers to keep offering great benefits on a smaller budget. When you take the administration of first-dollar benefits like copays for office and specialist visits away from the insurance company, you don’t have to pay as much for those benefits. The flexibility of MERPs let companies fund their employees’ medical expenses based on the budget and needs. And as a bonus, MERP funds transfer from year to year. So a company can build up funds over time. 

Related Post: HSA vs. HRA vs. MERP

The benefit to the company is also that MERPs lower the income that goes towards a tax liability. For example, a business owner has $500,000 in income in one year. The owner has $10,000 of qualified expenses he reimbursed for employees through the funding program. The owner does not pay income taxes on the $10,000 he contributed to that fund. At a 23.6 percent tax rate, the business owner pays $2,360 less in taxes for that $10,000.

ClaimLinx Navigates MERPs for You

The employee benefits consultants at ClaimLinx help business owners select the correct funding levels for MERPs, so employees save money on health insurance costs. Not only do owners lower their costs, but they also help retain employees with lower-cost employer-paid benefits. Contact ClaimLinx or call toll-free 1-800-858-1772 for more details on our ClaimLinx Solution.

What is an employer-sponsored, or self-funded, plan?

Note: The below information refers only to a ClaimLinx Simple Option Solution plan. There are other types of self-funded plans that these details would not apply to. 

As our members know, the ClaimLinx SOS plan uses a different type of strategy for providing the health insurance benefits employees need. It combines two types of insurance coverage: a traditional insurance plan with a major carrier for primary coverage and a self-funded Medical Expense Reimbursement Plan (MERP) for secondary coverage.

See how these two levels of coverage work together so an employer can provide better benefits at a lower cost. But what exactly is a self-funded plan and how does it make benefits less expensive for the company?

A self-funded plan, also referred to as an employer-sponsored plan, is one in which a company pays directly for medical services.

In the case of a ClaimLinx SOS plan, an employer pays only for qualifying services according to a MERP determined at the beginning of the plan. Following its effective date, all medical claims are processed by ClaimLinx as a third party administrator and are paid with funds directly from the company.

Using an employer-sponsored plan allows companies to continue to provide benefits at a lower cost because they are no longer prepaying for services to an insurance company in the form of premiums. Insurance carriers charge for a plan under the assumption that every employee will be using large amounts of services. In most cases, that just is not true.

Instead employers can purchase a high deductible plan and pair that with a MERP. That way they are only paying for services actually rendered to employees.

In addition, because ClaimLinx provides a full customized schedule of benefits with a member ID card, members should not be required to pay up front for services and wait for a reimbursement (excepting special circumstances). Claims are processed and payment is sent at a later date directly to providers. This means members should experience the same conveniences as with a traditional insurance plan.

In its simplest terms employer-sponsored, or self-funded, plans are those in which qualifying medical services are paid by the company.

All of this is made possible using a 60-year-old tax code that allows companies to deduct medical expenses for its employees. What it means for employees, though is that their employer can provide the benefits they need at a cost the business can afford.

 

What are copays, deductibles and coinsurance?

It’s not always clear exactly what your health insurance plan covers when fees and ending costs can feel like they’re hidden behind complex industry terms. So tackling understanding what they mean is important to knowing and using your benefits.

The below terms are all forms of “cost-sharing,” which is when medical services are paid by both the member and the health plan.

Copay — A fixed amount a person pays for qualifying types of services, such as office visits, specialist visits, prescription drugs or other procedures. For example, a member may have a $25 copay for an office visit with a primary care physician and a $40 copay for a specialist. All copays are fixed and detailed in the summary of benefits at the beginning of the plan and can be charged before and/or after a person has reached his or her deductible.

Deductible — The amount you pay for covered services before the insurance company begins to pay. For example, if you have a $2,000 deductible you will pay 100 percent of all eligible expenses until all the bills total $2,000. Once the deductible is paid, you will owe only any copays or remaining coinsurance for covered services. See Also: an article on embedded vs non-embedded deductibles.

Coinsurance — Paid after a person has met his or her deductible, it is a percentage of the allowed amount for services. For example, you have a coinsurance of 20% and the allowed amount for lab work is $100. If you have paid your deductible, you will owe 20% of the allowed amount of $100, or $20. If you have not paid your deductible, you owe the full amount of $100. Not all plans have coinsurance.

It’s important to be sure you understand your benefits when you receive your plan documents. All health insurance plans come with a summary of benefits, which includes informations on all copays, deductible and/or coinsurance. If you have additional questions about your plan, it’s best to contact the health insurance company directly.

You may always find contact information on your member ID card.