Bridging the Coverage Gap: Renting Healthcare Networks for Multistate Clients

The necessary rise in remote work during COVID lockdowns ushered in a paradigm shift in cultural attitudes toward the ideal working environment. Last year, about 1 in 5 workers in the U.S. worked remotely, with 98% of U.S. workers indicating they want to work remotely at least some of the time.

As companies expand across state lines and employ a geographically diverse workforce as a result of remote work, third-party administrators (TPAs) are faced with the challenge of providing comprehensive healthcare coverage across multiple states. Employers rely on TPAs to ensure that regardless of location, their employees have access to high-quality healthcare services. Securing coverage that spans states is no small feat, however. The combination of variances in regional healthcare networks, differing state regulations, and tenuous medical provider availability creates a labyrinth of considerations and roadblocks for TPAs.

Finding solutions that bridge this coverage gap is crucial for maintaining client satisfaction and employee well-being.

The challenge: a multistate workforce

Imagine managing the healthcare benefits for a large corporation based in New York City. The majority of the company’s employees work in New York, where the TPA has established a robust network of healthcare providers. But the hundreds of employees who work remotely in states like Ohio, Florida, and Texas also need access to healthcare, and the quality of that care must be consistent with what their New York colleagues receive.

The first issue a TPA needs to consider is the sheer diversity of healthcare networks across different states. Each state has its own dominant provider networks, and these networks often do not extend beyond state borders. As a result, a TPA might have to cobble together multiple regional networks to cover a single client’s workforce. This approach can lead to several problems. First, it increases administrative complexity because the TPA must manage contracts, claims, and provider relationships across multiple networks. Second, it can result in inconsistent care for employees, with some states offering more comprehensive or higher-quality services than others. Third, it may cause delays in care or access issues, particularly in rural or underserved areas where provider options are limited.

Consider a TPA managing benefits for a manufacturing company with plants in both Illinois and rural Alabama. In Illinois, the TPA has established relationships with several large healthcare networks that offer extensive provider options in urban areas like Chicago. The employees in rural Alabama, however, face a much different scenario. Their available networks may not offer the same range of specialists or might require employees to travel long distances for care. This disparity in access can lead to dissatisfaction among employees and put pressure on the TPA to find a solution that levels the playing field.

Another challenge arises from the need to comply with different state regulations regarding healthcare coverage. Each state has its own set of rules governing insurance plans, network adequacy, and provider credentialing. For a TPA, managing healthcare plans so they meet the regulatory requirements of multiple states can be daunting, as it often involves wading through an intricate system of legal and administrative hurdles, which can delay the implementation of a healthcare plan and increase costs for both the TPA and the client.

Providing healthcare coverage across multiple states can also be expensive, especially if the TPA has to negotiate separate contracts with different networks in each state. These costs can quickly add up, making it harder for the TPA to offer competitive pricing to its clients. Moreover, smaller employers with a scattered workforce may struggle to afford the high premiums associated with multistate coverage, leading to a situation where some employees have to forgo essential healthcare services.

The solution: renting healthcare networks

To address these challenges, TPAs can consider renting healthcare networks. Leasing a comprehensive network empowers TPAs to provide seamless coverage for employees no matter where they are located. This approach offers several advantages that make it an attractive option for TPAs handling multistate clients.

1. Access to high-quality providers across the country. Rather than piecing together multiple regional networks, a TPA can rent a single nationwide network that has already established relationships with top-tier providers in every state. Doing so ensures employees in different states receive consistent, high-quality care, regardless of where they live. For example, a TPA can rent a network that covers urban areas as well as rural regions. This nationwide reach eliminates the need for employees to travel long distances for care and provides them with a consistent level of service.
2. A lighter administrative burden. Renting a healthcare network also streamlines administration for TPAs. Managing multiple networks across different states can be a logistical nightmare that requires coordinating various contracts, claims processing systems, and provider directories. By renting a single network, a TPA can simplify this process, reducing the administrative burden and allowing them to focus on other important tasks. This streamlined approach not only saves time but also reduces the risk of errors and inconsistencies in coverage, leading to a better overall experience for both the TPA and the employees they serve.
3. Better rates and cost savings. Cost is another critical factor where renting a healthcare network provides a clear advantage. A partnership with an established network gives TPAs the ability to leverage the provider’s existing relationships and negotiate better rates. It’s particularly beneficial for small to midsize employers that may not have the bargaining power to secure favorable terms on their own. Renting a network allows these employers to offer their employees access to high-quality care at a more affordable price, helping control healthcare costs and improve employee satisfaction.
4. Happier employees. Employee satisfaction is one of the most compelling reasons for TPAs to consider renting healthcare networks. When employees have access to quality healthcare providers in their local areas, they’re likely to be satisfied with their benefits. This leads to higher employee retention and productivity, benefiting both the TPA and the client. The ability to provide consistent care across multiple states demonstrates a commitment on the TPA’s part to meet the needs of a diverse workforce, which further strengthens the client relationship.

Overcoming common obstacles

When implementing this solution, one common obstacle is ensuring that the rented network aligns with the client’s specific needs and preferences. For example, some clients may have unique requirements for certain specialties or types of care that might not be fully covered by a single network. TPAs should work closely with network providers, who can customize solutions that meet the client’s needs while maintaining coverage consistency.

Another challenge is managing the transition from multiple networks to a single rented network. This move can involve significant changes to the existing infrastructure and processes. The long-term benefits of streamlined administration, cost savings, and improved employee satisfaction, however, often outweigh the initial investment.

A flexible future

As the workforce continues to evolve, the demand for flexible nationwide healthcare solutions will continue to grow with it. TPAs that embrace the concept of renting healthcare networks will be better positioned to meet their clients’ needs and stay ahead of industry trends. By offering access to premier providers, streamlining administration, reducing costs, and enhancing employee satisfaction, this strategy meets the current and evolving needs of a diverse workforce while also paving the way for future growth.

Ready to jump in?

Making sense of the complexities of healthcare coverage for a multistate workforce can be hard, but MagnaCare is here to simplify the process. Renting a healthcare network through MagnaCare allows TPAs to offer high-quality nationwide coverage that meets the diverse needs of their clients and their employees.

With access to premier providers across the country, streamlined administrative processes, and cost-effective solutions, MagnaCare’s network rental services help ensure that employees receive consistent, top-notch care no matter where they are located. This approach enhances employee satisfaction while reducing costs and operational complexities for TPAs.

If you’re ready to bridge the coverage gap and provide seamless, nationwide healthcare solutions for your clients, it’s time to partner with MagnaCare. Let us help you deliver the consistent, high-quality care your clients’ employees deserve.

Get in touch with MagnaCare today to learn how our network rental services can transform the way you serve your clients.