Executive Summary: The Complete Product Architecture: Core Through Black
LFP-15.SYN, The Product Architecture#
The 1-to-50 employer market is served today by products that assume homogeneity. Fully insured coverage offers standardized benefits at community-rated prices with no transparency into claims experience. Commodity level funded TPAs offer administrative services without active cost management. Neither product addresses the employer who wants transparency, cost management, and a benefit structure matched to their specific population. The tiered model addresses that heterogeneity directly.
Core provides standard level funded administration executed with precision: claims adjudication above 99% accuracy, eligibility management that handles the exception-intensive small group environment, stop loss coordination, ERISA-compliant documentation, and reporting that gives employers visibility into cost drivers. Network access, ancillary benefit integration, member portal, and broker dashboard complete the stack. Core competes on execution quality at competitive PEPM. The margin is modest. The business case is market entry, reputation building, data generation, and the foundation for Plus and Black.
Plus adds six cost management programs, domestic facility steering, pharmacy optimization, maternity management, MSK pathways, chronic disease programs, and enhanced analytics, bundled as standard features rather than add-ons. The design decision is deliberate: bundling produces better outcomes than optional modules because savings are captured across the population regardless of individual employer engagement decisions. The employer who selects Plus pays more in administration and receives more back in claims savings. Carrum Health facility steering produces savings up to 45% per surgical episode. Maven Clinic maternity management saves an average of $9,600 per birth. Hinge Health and Sword Health MSK programs produce average savings of $3,177 per engaged member per year. Chronic disease programs reduce medical spending by approximately $83 PMPM for engaged diabetes participants. Plus competes on value that is measurable and demonstrable at renewal.
Black adds geographic arbitrage at scale: cross-border medical care at JCI-accredited facilities at 40% to 70% savings on surgical procedures, cross-border dental at 50% to 80% savings, international pharmacy purchasing at 50% to 90% savings on high-cost specialty medications, SDOH signal integration, advanced chronic disease interception, GLP-1 management as a structured clinical program, social isolation screening for the distributed workforce, predictive analytics, and full member concierge. One international procedure shifted from $50,000 domestic to $25,000 at a JCI-accredited facility saves more than the annual Black premium differential for a 30-person group. Black competes on capability that no competitor in the current small group TPA market has built. The target population, mobile professionals, remote-first technology companies, high-income small employers, has willingness to pay for coverage that matches their expectations and mobility.
Three distribution channels serve three employer populations. The broker channel remains primary, enabled by tier recommendation frameworks, an AI co-pilot that performs census analysis and multi-model comparison, and a broker intelligence portal that makes advisory performance visible at renewal. The direct channel reaches micro-employers without broker relationships through fully digital Core self-service, AI-augmented Plus advisory, and consultative Black sales. The association channel pools employers below 10 lives, where individual stop loss economics fail, through industry associations, professional organizations, and chambers of commerce whose endorsement creates captive distribution that competitors cannot quickly replicate.
The complete architecture is operational across four years from Core launch to Black deployment. The moat, cross-border infrastructure, accumulated claims data, broker dependencies, association endorsements, and the feedback loop that compounds each component’s value, deepens with each year of operation. This is what the reimagined TPA looks like.