Calibrating for Cost Cutters

In the unnecessarily complex world of insurance claims and restoration projects, third-party administrators (TPAs) often leverage their power and influence to take advantage of restoration companies. Worse still, property owners pay the biggest price for TPA penny-pinching when their project is off schedule, under budget, or finished with subpar work and materials.

Fortunately for restorers, these intransigent companies have an uncompromising bureaucratic nature, leaving them with an overworked staff and an antiquated system that can be circumnavigated with the right skills and knowledge.

Yet, the same dated system portals that TPAs use to wrench profits away from vendors can be used against them to recover those profits.

Understanding TPA portals

TPA portals serve as centralized platforms for managing insurance claims and providing access to critical information and resources for all the pertinent parties involved in the claim.

Each TPA portal is a different beast, but they all tend to follow the same principles and rules. The first step in getting the most out of every TPA is to familiarize yourself with your TPA portal’s layout, features, and functionalities. It truly helps to get the most out of each TPA.

Every TPA portal has a staff member on the other side who has never stepped foot on a jobsite and has no idea what the difference is between Durock® cement board and drywall. This means that they won’t know what they are doing or talking about most of the time. On the other hand, they will have a spreadsheet that dictates what they can say on any given estimate.

If you learn what they know, what they are looking for, and what they don’t understand because of having never been to a job site, you can start finding ways to make a project work.

Estimator tools

Each portal will have different requirements for the kind of estimate format that they are willing to accept. That said, most TPAs will mandate that estimates be submitted in either Symbility or Xactimate formats. If the TPA accepts one, they likely won’t accept the other.  In turn, make sure to write your estimates in the program that the TPA dictates, or you will be wasting time and resources redoing the same work.

Regardless of the TPA’s estimator format, you can learn all the specifics involved in each program to ensure you are not shortchanged on your project totals. This is where skills with estimator programs and macros scripts come into play. The more tricks you know with these programs, the more money you will be able to save.

Working with TPA agents

TPA agents play a significant role in facilitating communication and collaboration between homeowners, contractors, and insurance carriers. Their decisions can be received either favorably or unfavorably.

When you have a good relationship with your TPA agent, it is easier to deal with the expense. But, it is also easier to find ways that they won’t realize you’ve put money into your pocket, too. The likelihood that your TPA agent has never stepped foot in the field will be evident in these conversations. And it’s in these conversations that you can learn everything your agent is looking out for and simultaneously all the things they will likely miss, too.

Submissions and supplements

One of the most critical aspects of getting paid from a TPA provider is to ensure all your ducks are in a row before making any submissions or supplements. The agent will never tell you that you’ve missed something, so if you don’t catch your mistakes, you will pay for them later.

On the mitigation side of TPA work, you won’t be paid until after all the work is done.  While doing the work, you will also likely encounter a healthy amount of pushback on any line items you have that the agent doesn’t readily understand. You may even have pushbacks on completely necessary things that make total sense, but because they have never extracted a drop of water themselves, they think they can check you on it for a few bucks.

Stand your ground as often as you can tolerate doing so. TPAs will always try to reduce the amount they have to pay out, but they can’t do so at the cost of reasonable care for the client they are serving. If you can frame your argument in a light that shows their customer needs what you are asking for, they will be much more likely to find a way to pay for it.

The same rules apply to supplements, but even more so because they will be scrutinized with a higher degree of attention. Additionally, it’s critical to remember to reapply your overhead and profit margins to the total.

Supplements, such as initial estimates, require a healthy understanding of the terminology used to get the most out of a project. Suppose you are reconstructing a wall; you know that shifting the terminology of your description around (in deference to the TPA agent) will get the job done without being shortchanged for the total distance of the drywall. In that case, this is a terminology alteration that you can take full advantage of.

Pick for profit

When it comes to TPA work, you don’t get to pick your battles, but you do get to choose what kind of war you want to fight. Each TPA is different. Some of them will be much easier to work with than others. Pick your TPA based on your capacity rather than trying to make your capacity work for the TPA. This means more than just staffing appropriations. Choosing a TPA is half the battle. Read reviews and ask other people in the industry what they think.

Picking your TPA is a critical step in ensuring you get the most value out of the work. Not all of them are built equally, and finding the right niche to exploit might just be how you get the most value out of the prospect. At the end of the day, while TPA work feels like indentured servitude, it’s still a vastly cheaper source of leads than many other means of accruing them.

In the competitive and often convoluted world of insurance restoration claims, TPAs wield significant influence that can regularly disadvantage restoration companies and customers alike. Unfortunately, this can lead to compromised timelines, inadequate budgets, and substandard workmanship—ultimately impacting property owners the most while trying to save a buck.

However, amidst the bureaucratic chaos caused by TPAs lies an opportunity for restoration providers to assert themselves. By navigating TPA portals with precision, understanding the intricacies of estimator software, fostering effective relationships with TPA agents, and mastering the submission and supplement process, restoration companies can reclaim control over their projects and secure fair compensation for their services.

In essence, by fully understanding and leveraging the systems designed to curtail their profits, restoration providers can ensure that they emerge from the chaos profitably, ethically intact, and as advocates for the property owners they serve with quality work.

Alexander Ruggie is the marketing and business development director for ASAP Restoration LLC. He has a proven record for growing businesses, both large and small, with strategic planning and targeted content that delivers results.

 Joshua Rudin owns ASAP Restoration LLC and is a certified restorer. Before opening the doors in 2008, Rudin had been a successful entrepreneur in the restaurant industry, owning and running several thriving locations for over two decades. To reach Rudin, visit AsapRestoration247.com, call 602-515-7918, or email [email protected].