How to Elevate Your TPA Relationship

Many organizations still treat their Third-Party Administrator (TPA) as a transactional service provider, focused mainly on processing claims. However, with the right selection process, collaborative operating model, and data-driven strategy, your TPA can become a trusted partner that advances long-term business goals.

1) Understand the role of a TPA and how to select the right partner

A TPA manages claims and provides administrative support for self-insured programs, including workers’ compensation, liability, property, absence, and specialty services. Outsourcing these functions allows employers to focus on core operations while ensuring claims are managed efficiently.

Leading organizations use a structured market assessment, often an RFP, to evaluate fit, capabilities, and service approach. The process should prioritize strategic alignment over price. During implementation, negotiate service instructions, KPIs, and performance guarantees that reflect your business priorities. Set expectations for review cadence and reporting before launch.

2) Create a collaborative environment with your TPA

Establish a communication plan that matches stakeholder preferences, including meeting rhythm, escalation paths, and rapid response channels. Clarify roles for day-to-day coordination and senior-level escalation to ensure agility when challenges arise.

Assign an account lead to coordinate operations, data insights, and long-range planning. This role anchors the partnership in shared goals and maintains continuity. When issues occur, resolve them quickly and capture lessons to prevent recurrence. Use defined escalation mechanisms and cross-functional collaboration to address root causes and protect brand trust.

3) Increase engagement with data-driven insights and strategic planning

Treat your claims program as an enterprise risk engine. Use analytics to benchmark performance, identify hotspots, and pinpoint improvement opportunities such as return-to-work pathways or supervisor communication practices.

Align dashboards to outcomes like claim duration, indemnity costs, medical severity, litigation rates, and RTW speed. Review insights at a cadence that fits your culture and link findings to action items. Use trend data to inform prevention and program design, building resilience and reducing variability over time.

4) Implement strategies that foster engagement, accountability, and alignment with long-term objectives

• Co-define success with a joint outcomes charter, including KPIs, targets, guardrails, and governance.
• Formalize roles and escalation tiers for rapid decision making.
• Set meeting cadences and decision forums to maintain momentum and accountability.
• Use scorecards and performance guarantees, reporting on key metrics and connecting results to improvement plans.
• Refresh your strategy as conditions change to keep the program aligned with business goals.

5) Elevate your TPA from vendor to strategic partner

A strategic partnership is a long-term, mutually beneficial relationship focused on shared business objectives. When your TPA is integrated into planning and decision making, they become part of your organizational fabric, proactively surfacing recommendations and helping you achieve your goals.  When a true partnership is achieved, you can look to your TPA and ask broader, forward-thinking questions like – What can we do better together? and What can you do next for us to help us solve our business needs?

An action plan for 2026

• Schedule a working session with your TPA to co-define success and align KPIs, service instructions, and governance.
• Build a data-driven roadmap with peer benchmarks, target outcomes, and quarterly milestones.
• Lock in meeting rhythms and scorecards, assigning owners for each metric and improvement initiative.
• Celebrate success and find ways to incentivize great performance with your TPA.  Partners like to be told “great job!” and those high performers will continue to support your goals, initiatives and long-term partnership.

With a clear selection process, collaborative operating model, and analytics-powered strategy, your TPA can help you move from reactive claims handling to proactive risk leadership, delivering better outcomes for your people and your business.

Why Sedgwick?

Sedgwick helps organizations transform their TPA relationships from transactional to truly strategic. Our team brings deep expertise, advanced analytics, and a collaborative approach aligned with your long-term objectives. We partner with you to drive continuous improvement, accountability, and resilience across your risk program. If you’re ready to elevate your TPA relationship and unlock greater value for your organization, let’s start a conversation.