[apsec112]

A lot of private "health insurance" at large companies is just:

- the company pays out-of-pocket for all employee health expenses

- they don't want to directly deal with bills from doctors and hospitals, so they contract that out to a third-party administrator (TPA), which purely handles paperwork and has no financial role at all

but this doesn't remove the tension between the employer wanting to pay less, and the patient wanting more to be paid for

(and for single-payer systems, you still have the tension between taxpayers wanting to pay less and patients wanting more care, although those groups at least overlap a lot more)

[tbrownaw]

Insurers will also sometimes contract out their claim handling to those same TPAs.