Third-Party Administrator (TPA) | Practical Law
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Third-Party Administrator (TPA)
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Third-Party Administrator (TPA)
Practical Law Glossary Item w-020-6815
(Approx. 3 pages)
Glossary
Third-Party Administrator (TPA)
In the employee benefits context, a type of
service provider
for an
employee welfare benefit plan
or
employee pension benefit plan
. Services provided by a TPA may include:
Recordkeeping.
Participant
communications.
Claims processing, for example, regarding health plan continuation requirements under the
Consolidated Omnibus Budget Reconciliation Act of 1985
(COBRA) (see
COBRA Toolkit
).
Administering prescription drug benefits (if the TPA is a
pharmacy benefit manager
(PBM)).
Government reporting (for example, preparing and submitting
Form 5500
s).
A TPA that performs solely ministerial functions for a plan governed by the
Employee Retirement Income Security Act of 1974
(ERISA) generally is not an ERISA fiduciary, unless the TPA exercises discretion or control over the plan (see
Practice Note, ERISA Fiduciary Duties: Overview
). In addition, a TPA that assists with plan administration generally does not do so as the plan's formal
ERISA plan administrator
(but see
Practice Note, Contraceptives Coverage Under the ACA: TPA Responsibilities Under Accommodation
).