Ohio Updates TPA Late Fees with New Graduated Penalty Structure

Ohio is implementing a significant change to how late fees are assessed for Third Party Administrator (TPA) licenses. Beginning March 12, 2026, late fees will no longer be a flat amount. Instead, fees will decrease incrementally depending on how many months have passed since license expiration. This change impacts both resident and non-resident TPA licenses and applies to entity filings. Understanding how the new schedule works is essential for organizations managing multiple licenses and renewal cycles.

What Qualifies as a Third Party Administrator in Ohio

Under Ohio law, a Third Party Administrator (TPA) is generally defined as any person or entity that adjusts or settles claims related to life, dental, vision, health, or disability insurance plans, self-insurance programs, or other benefit plans, provided the plan sponsor or the plan itself is domiciled in Ohio or maintains its principal headquarters or administrative offices in the state.

However, not all entities involved in benefit-related activities fall under this definition. Ohio specifically excludes several categories from being considered TPAs, including:

• Insurance agents or solicitors licensed in Ohio whose activities are limited solely to the sale of insurance and who do not perform administrative services
• Individuals or entities administering only an employer’s self-insured workers’ compensation program approved under Ohio Revised Code §4123.35
• Organizations administering pension plans for their own members or employees, or for the members or employees of another entity
• Entities administering insured plans or self-insurance programs exclusively for their own employees or members
• Health insuring corporations organized under Chapter 1751 of the Ohio Revised Code, as well as insurance companies authorized to write life or sickness and accident insurance in Ohio

Entities that meet the definition of a Third Party Administrator are required to be licensed with the Ohio Department of Insurance in accordance with Ohio Administrative Code 3901-8-05 and Ohio Revised Code §§3959.01–3959.99.

Understanding whether your organization qualifies as a TPA is a critical first step in determining whether this late fee update applies to your license.

What Is Changing with Ohio’s TPA Late Fees

Effective March 12, 2026, Ohio will replace its flat $300 TPA late fee with a tiered, month-based fee schedule. This update applies to both resident and non-resident TPA licenses and affects entity filings only.

Under the previous structure, TPAs faced the same penalty regardless of how long the license had been expired. The new approach introduces a declining fee model, where penalties decrease as the expiration period extends over time.

New Graduated Late Fee Schedule Explained

Ohio’s updated late fee structure is based on the number of months past the license expiration date:

• 1-month past expiration (July): $300
• 2 months (August): $275
• 3 months (September): $250
• 4 months (October): $225
• 5 months (November): $200
• 6 months (December): $175
• 7 months (January): $150
• 8 months (February): $125
• 9 months (March): $100
• 10 months (April): $75
• 11 months (May): $50
• 12 months (June): $25

This schedule creates a clear financial incentive for earlier renewal while offering relief for long-expired licenses returning to active status.

Who Is Impacted by This Update

This change applies to:

• Third Party Administrator (TPA) licenses
• Resident and non-resident filings

Entity applications only

Operational Considerations for TPAs

While the graduated structure may appear more flexible, TPAs should not view this as an opportunity to delay renewals. Operating with an expired license can create regulatory exposure, disrupt operations, and delay onboarding or contract execution.

Summary

Ohio’s move to a graduated TPA late fee structure represents a meaningful change in how renewal penalties are calculated. While the new schedule offers reduced fees over time, timely renewal remains the best way to avoid unnecessary costs and operational risk. TPAs operating in Ohio should review renewal calendars, educate internal teams, and adjust processes ahead of the March 12, 2026 effective date.