Who administers the plan during the first five years?

• A. A third-party administrator (TPA)
• B. The insurer
• C. Group employees
• D. State agency

Answer: (A)

In a California Self-Insurance Plan, the day-to-day administration is handled by a third-party administrator during the first five years. This arrangement ensures professional claims handling, medical management, reporting, and regulatory compliance as the plan demonstrates its financial stability. The insurer provides coverage but does not administer the self-insurance program in this initial period, and the group employees do not act as the plan’s administrator. The state agency oversees approval and supervision, but it does not run the plan’s administration. After the five-year period, the plan may transition to a different administrative setup if it meets the required requirements.