Companies that give employees healthcare benefits choose between buying coverage from an outside insurer or operating their own insurance plans in-house. Choosing to operate an in-house plan can be a massive task. That’s why companies choose to contract with insurance management companies. UMR, UnitedHealthcare’s third-party administrator founded in 1983, is basically the most widely used third-party insurance administrator for companies. Third-party administrators work to administer self-funded health insurance programs. UMR manages insurance plans at a negotiated cost to your employer. Third-party administrators provide services like billing, claim processing, and administration on behalf of various insurers. They are not an insurance company, so you cannot purchase medical insurance plans directly from UMR. UMR now serves over 5 million members with custom insurance plans.
What services does UMR provide?
Self-funded UMR insurance plans can be managed more comprehensively. Plans include medical insurance and plans for vision, dental, and disability. Companies may give their employees a health insurance plan through an HMO, but self-fund their vision or dental insurance using a third-party administrator. UMR offers certain discounts on in-network health services, as well as over 100 other partner networks you can use through your employer insurance. Other benefits UMR provides are various pharmacy benefits, programs aimed at wellness, and stop-loss coverage.
Here are some benefits of working with third-party administrators:
- A third-party administrator will handle payments because they act as payers for self-funded sponsors.
- A third-party administrator will handle claims processing. Self-insured companies can reduce personnel needs by outsourcing claims processing to a third-party administrator.
- Third-party administrators will find opportunities to reduce costs and improve services by conducting medical care reviews. They will also find the preferred provider organization (PPO) best qualified to provide health services to the policyholders and to their dependents.
- Third-party administrators will typically handle all customer support questions. They solve issues like billing disputes, claims, and appeals.
Self-funded vs. Insured Plans
Your employer, not an insurance carrier, will finance a self-funded benefit plan. A self-funded company is one where the employer pays for most of your health plan and claim costs. Companies try to stay competitive by offering solid benefits packages to their employees. Companies with large revenues may choose to fund health care plans in-house instead of paying premiums to an insurance company. Opting for self-funded plans may also save your company money. However, there are unexpected expenses associated with using UMR.
How does UMR insurance work?
UMR works like most other medical insurance companies. Self-funded companies will provide a list of covered benefits to their employees. They will also offer their employees information on possible deductible and co-insurance requirements. UMR insurance differs from an actual HMO plan the employer funds on its own. With UMR insurance, a third-party administrator will ensure that employees are covered and receive care that they’re entitled to. Employers pay more through monthly premiums for fully insured plans, but they can deduct them as a business expense, which can bring the cost down.
After signing up for a plan, you can contact UMR to give you an overview of what plan the plan entails. UMR also provides health professionals that can coordinate a policyholder’s hospital care. UMR has made filing a claim easier because they now only ask for prescription drug claims and no claim forms. You’ll need to show your UMR ID card to your doctor, and the doctor will take care of handling billing. If you want to make an appeal for a claim, you must make it with UMR within 180 days after your claim was denied.
What are the costs associated with UMR insurance?
Self-funded insurance usually costs less than fully funded plans, both for the employee and employer. This is because it reduces some expenses included in traditional insurance plans, like taxes on gross premiums and underwriting costs. UMR insurance doesn’t require you to pay premiums based on higher community rates for groups at higher risk. If you run a small business with healthy employees, consider UMR insurance. Because the company funds the plan instead of the carrier, the carrier lowers its rates because it has less risk.
How do you interact with UMR?
Interacting with UMR is basically the same as interacting with a conventional insurance provider. You’ll receive an enrollment package when you become eligible for a plan. The package will provide instructions on how to get in touch with UMR and how to file claims. You can access your account by logging into UMR’s website. UMR dedicates a team to help you and your coworkers, depending on how many employees your company has and how much they pay for UMR service.
Frequently Asked Questions
What is UMR insurance?
UMR is a third-party administrator, not an insurance company, wholly owned by UnitedHealthcare, a part of UnitedHealth Group. UMR works with your employer’s insurance choice to administer insurance plans.
What can UMR insurance do for you?
UMR can give you personalized service. By having a UMR insurance plan, you’ll have access to a customer service team to answer questions related to your health benefits. For example, you can ask the customer service team about your coverage or about a specific health claim.
Is there anything I can do to reduce my health care costs?
Most third-party administrators work with a preferred provider organization (PPO). A PPO is a network of healthcare providers that have agreed to provide coverage at a certain, often reduced, cost. If you choose a participating PPO provider, you’ll likely receive discounts on health insurance plans.
With UMR insurance, you can access your explanation of benefits (EOB) online. Read your EOB to understand what your benefits entail. This can help you track how much you’re spending on insurance.
Does UMR insurance cover drug and alcohol rehab treatment?
Drug and alcohol rehab coverage isn’t offered directly through UMR because UMR is not an insurance company. However, there are thousands of health care providers within this third-party network and the Affordable Care Act requires that all insurance providers allow for addiction care. UMR drug treatment programs may partially cover inpatient residential treatment, outpatient rehab treatment, and psychotherapy, among other things.