The Claims Crisis TPAs Can’t Ignore Anymore

For decades, third-party administrators (TPAs) have relied almost entirely on claims data to identify risk, design benefits strategies, and support employer groups. But with rising healthcare costs and shifting employer expectations, that reactive model is no longer enough—prompting a growing demand for data-driven wellness programs for TPAs.

Today’s landscape looks very different. The cost of chronic disease is rising faster than premiums. GLP-1 drugs are disrupting cost projections. MSK spend is climbing. Mental health claims continue to surge. Employers want proactive solutions—not more reports about what went wrong last quarter. And they increasingly expect data-driven wellness programs for TPAs that can surface risk before it becomes a claim.

The numbers tell the story:

  • 75% of healthcare spending is driven by preventable chronic conditions (CDC).
  • 86% of total costs stem from chronic and mental health issues—many of which can be reduced through early lifestyle intervention.
  • Claims runout can stretch 3–6 months, meaning TPAs are always reacting once the financial damage is done.

Put simply: if your insights are coming solely from claims, you’re already too late. This is why so many administrators are turning to data-driven wellness programs for TPAs—solutions designed not just to measure risk, but to actively reduce it.

Prevention is no longer a perk. It’s a claims strategy. And TPAs who embrace data-driven wellness programs for TPAs are quickly setting themselves apart in a market where employers are deciding whether to stay, churn, or choose a competitor based on one question:

Can you help us reduce claims before they happen?

The Problem With Relying on Claims Data Alone

Claims data is essential—but it’s not enough anymore.

1. Claims data is lagging, not leading

By the time a claim appears, risk has already progressed into cost.
Often, months after the moment the condition worsened.

TPAs are left saying:
“We’ll address this next year.”

Employers don’t want next year.
They want action now.

2. Claims only show the tip of the iceberg

Claims tell you what care was billed, not:

  • who is at rising risk
  • who is disengaged
  • who is burning out
  • who is not sleeping
  • who is experiencing MSK pain
  • who is struggling with weight, stress, or nutrition
  • who could avoid a future diagnosis with timely support

These insights exist long before anyone enters a clinic.

3. Claims don’t measure human behavior

Healthcare spend is largely driven by habits, not healthcare utilization.

Yet claims only show behavior once someone has interacted with the system.

You can’t change what you can’t see—until now.

The Shift: Why TPAs Are Turning to Real-Time Wellness Data

Employer expectations are changing. And they’re changing fast.

A 2024 Willis Towers Watson survey found that 81% of employers expect their TPA to proactively reduce chronic disease risk, not just pay claims.

That means TPAs need access to behavioral data, engagement data, and population-level wellness indicators—updated daily, not quarterly.

The New Data TPAs Need to Stay Competitive

Data-driven wellness programs give TPAs access to four categories of information that claims data cannot provide:

1. Lifestyle and Behavior Indicators

These early signals reveal rising health risks long before they show up in claims data. They include:

  • Activity and daily movement levels
  • Sleep quality and consistency
  • Stress patterns and reported burnout
  • Nutrition and eating habits
  • Ergonomic or posture-related strain
  • Adherence to preventive care and screenings

These indicators appear well before major conditions take hold—
before diabetes develops,
before MSK pain becomes a costly claim,
before elevated blood pressure turns into hypertension,
before stress escalates into depression,
and long before weight gain progresses into obesity.

This is real-time prevention, not post-claim intervention.

2. Engagement and Participation Signals

Healthy behavior only matters if people actually do it.

That’s why engagement data matters:

  • Who is participating in wellness challenges?
  • Who is completing skill-building programs?
  • Who is earning recognition for wellbeing milestones?
  • Which teams are showing improved morale?
  • Where is burnout rising?

Engagement is the engine that drives behavior change.
And behavior change drives claims reduction.

These insights predict rising risk long before a claim hits, including:

  • burnout indicators
  • mental health stress patterns
  • declining resilience
  • isolation signals in hybrid/remote teams
  • low morale clusters
  • workload strain

Claims can’t reveal any of these.
Engagement and sentiment analytics can.

4. Population Health Movement Over Time

Employers don’t want logins.
They want improvement.

Real-time wellness dashboards give TPAs the ability to report:

  • rising vs. falling risk factors
  • improvements in activity
  • percentage of population hitting wellbeing goals
  • biometric improvements across groups
  • participation correlated to lower claims categories

For the first time, TPAs can show:
“Here’s how your population is getting healthier in real time.”

That’s a competitive advantage buried in plain sight.

The TPA Competitive Landscape Has Shifted — Permanently

Claims administration is now table stakes.
Employers expect more.
Brokers expect more.
The industry expects more.

Three macro trends explain why:

Trend 1: Employers Are Losing Patience With Rising Chronic Disease Costs

Chronic disease is consuming employer budgets at an accelerating pace, and the latest national data makes the urgency unmistakable. The American Diabetes Association’s 2022 cost-of-illness report estimated the total annual cost of diagnosed diabetes at $412.9 billion, noting that people with diabetes now account for one in every four U.S. healthcare dollars. Likewise, the Milken Institute reports that excess weight and obesity place a $1.7 trillion economic burden on the United States when combining direct medical expenses and lost productivity. Mental health challenges add a similarly staggering financial strain; a 2024 analysis from Yale University places the annual economic impact of mental illness at $282 billion, underscoring how untreated behavioral health conditions drive both medical and productivity losses.

Together, these trends illustrate why employers increasingly expect TPAs to intervene earlier, address the lifestyle and behavioral patterns contributing to chronic disease, and demonstrate measurable prevention—not just passively adjudicate claims after costs have already escalated. TPAs that cannot support upstream risk reduction are losing ground to competitors who can deliver proactive, data-informed wellness and prevention strategies.

Trend 2: Consolidation Is Accelerating

Large players (Elevance/Personify, Sharecare, Virgin Pulse, Accolade, etc.) are acquiring or building wellness layers specifically to lock in employers.

If independent TPAs want to compete, they must offer:
Wellness + prevention + data insights
—not just claims processing.

Trend 3: Employers Now Demand Proof of Outcomes

Gone are the days of “trust us, engagement is high.”

Employers now ask:

  • What’s the ROI?
  • Are we lowering risk?
  • Are chronic conditions stabilizing?
  • Are we reducing MSK pain?
  • Are mental health risks declining?
  • Are people improving their habits?

Claims datasets cannot answer these questions that easily.

Real-time wellness data can.

How Data-Driven Wellness Programs Reduce Claims (The 5 Mechanisms)

Below are five proven ways TPAs use real-time wellness programs to cut claims—significantly and sustainably.

1. Reducing the Incidence of Chronic Disease

Chronic conditions rarely appear suddenly.

They develop from lifestyle patterns over years.

Wellness programs:

  • identify at-risk individuals early
  • target interventions around habits
  • support behavior change before a diagnosis
  • prevent the progression from prediabetes → diabetes
  • reduce obesity before GLP-1 drugs become necessary
  • address hypertension before medication escalation
  • support sleep and stress to avoid long-term mental health claims

Research shows that individuals who adopt healthy lifestyle patterns — including regular physical activity, balanced nutrition, healthy weight, and preventive care — experience significantly greater disease-free years and substantially lower incidence of chronic conditions such as cardiovascular disease, type 2 diabetes, and metabolic disorders.

This directly reduces claims.

2. Preventing High-Cost MSK Episodes

MSK claims are now the #1 cost driver for many employers.

Overuse injuries, ergonomics issues, and sedentary behavior cause:

  • chronic back pain
  • repetitive strain injuries
  • sciatica episodes
  • disc herniations
  • unnecessary imaging
  • avoidable surgeries

Data-driven wellness programs reduce MSK claims by:

Every avoided MRI or surgery is a direct claims reduction win.

3. Avoiding Mental Health Escalations

Mental health claims have surged since 2020.

Burnout alone drives:

  • absenteeism
  • presenteeism
  • disability claims
  • therapy + medication claims
  • comorbid chronic conditions

Real-time wellness programs help TPAs:

  • detect early burnout signals
  • provide preventative stress and resilience tools
  • support belonging and social wellbeing
  • identify teams needing intervention

Untreated mental health issues can increase total medical spend by 2–3x.
Prevention here is essential.

4. Improving Preventive Care Utilization

People who complete preventive screenings:

  • catch disease earlier
  • avoid emergency visits
  • reduce complications
  • lower long-term spend

Wellness programs increase:

  • annual physical completion
  • A1C screenings
  • mammograms
  • blood pressure checks
  • cholesterol tests

This is the simplest and fastest claims saver.

5. Boosting Medication Adherence

Many claims spike not from overuse—but from underuse.

Wellness nudges and reminders improve adherence for:

  • hypertension meds
  • lipid-lowering meds
  • antidepressants
  • diabetes medications

Better adherence = fewer complications = fewer claims.

Case Study Example (Fictionalized but Realistic)

A regional TPA with 22 employer groups added a real-time wellness program:

  • Claims for preventable MSK cases dropped 18% in the first year.
  • Prediabetes conversion dropped by 32% among engaged participants.
  • Employee engagement increased 44%.
  • Mental health claims plateaued for the first time in five years.
  • One employer avoided an estimated $210,000 projected GLP-1 spend through lifestyle-first programs.

The TPA retained every client at renewal—zero churn.

This is what employers want:
Prevention with proof.

Why Real-Time Data Gives TPAs a Massive Strategic Advantage

1. Better Renewal Conversations

Instead of explaining last year’s claims, TPAs can show:

  • improvements in risk
  • participation in healthy behaviors
  • reduced lifestyle risk markers

Employers no longer see wellness as a perk—they see it as a claims strategy.

2. Stronger Differentiation in Broker RFPs

Brokers are tired of “We process claims efficiently.”

But they love:

  • daily dashboards
  • predictive analytics
  • preventative risk modeling

This is how TPAs win new groups.

3. Increased Retention

Employers leave TPAs who only react.
They stay with TPAs who reduce risk year-over-year.

4. Better Alignment With Population Health Goals

Real-time wellness data helps TPAs:

  • stratify risk
  • identify high-risk clusters
  • design targeted interventions
  • support rising-risk individuals
  • track progress in real time

This is where the industry is headed.

Why a Unified Platform (Like Woliba) Matters More Now Than Ever

Employers are tired of fragmented wellness vendors.

They want:

  • one system
  • one login
  • one dashboard
  • one set of insights
  • one engagement engine
  • one place where recognition, wellness, coaching, and data live
  • one partner who can drive outcomes

Woliba gives TPAs:

  • real-time behavioral data
  • population-level insights
  • preventative wellness challenges
  • mental health and burnout detection
  • recognition + engagement signals
  • personalized wellness journeys
  • reporting tools that employers actually understand

A unified platform solves the biggest TPA issues:
disconnected data, low engagement, and no measurable prevention outcomes.

The Future: Prevention, Not Adjudication

The next decade of TPA success will be determined by one question:

Can you reduce claims—not just process them?

The TPAs who answer “yes” will win.
The TPAs who hesitate will fall behind consolidated competitors.

The secret is simple:
Real-time, behavior-based, data-driven wellness programs.

They give TPAs the one thing employers want most:
A healthier population that costs less to insure.

How Woliba Helps TPAs Turn Prevention Into Measurable Claims Savings

Woliba gives TPAs the tools to deliver what employers want most:
Preventative, measurable, real-time health improvement at scale.

With Woliba, TPAs can:

Your employers don’t just want a TPA.
They want a partner who can keep their people well—and their spend predictable.

Let’s build that together.