Employers are the largest purchasers of health care in the United States, covering more than 165 million people, yet they face persistent difficulty controlling costs. Most enrollees are in self-insured plans, which rely on third-party administrators (TPAs) to build provider networks and adjudicate claims. The fees employers pay these administrators are an under-documented source of health care spending. While recent litigation and news reporting allege that administrators overpay providers and charge large fees, the peer-reviewed literature offers limited detail on how these compensation mechanisms operate.<\/p>\n
We conducted 22 semi-structured interviews with 34 participants during the fall of 2025, drawn from four groups nationwide: employers and employer coalitions; TPAs and partners; benefit consultants and brokers; and legal and policy experts. Transcripts were coded and analyzed for key themes.<\/p>\n
Participants distinguished the base administrative fee, which employers compare across vendors, from additional fees that are less visible at contract signing. These include percentage-based shared-savings fees on out-of-network claims, overpayment-recovery fees, retained network discounts, a-la-carte service fees, and cross-plan offsetting. Interviewees described two pathways to address these fees\u2014expanded transparency and clearer fiduciary accountability.<\/p>\n
While potential solutions exist, market consolidation may limit employers\u2019 ability to act on disclosed information.<\/p>\n