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Program work is a channel you rent. Carry it in the mix, but don't let it become your foundation.

A RocketLevel primer for restoration owners weighing how much third-party administrator (TPA) and program work to carry, backed by decades of experience in the trade. About a 7-minute read.

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Why owners ask about this

TPA and program work is the water that a lot of restoration shops swim in. The jobs show up without selling, the volume feels steady, and walking away seems unthinkable. But owners also feel the squeeze: rates they did not set, fees off the top, and the quiet worry that one decision in someone else's office could reshape the year. Knowing how these programs work lets you run them on purpose instead of by default.

What TPAs and programs actually are

Third-party administrators, or TPAs, manage claims and contractor networks on behalf of carriers. They route work to approved contractors, set the rules, and take a referral fee or cut. Much of the program work in the industry flows through a small number of large managed-repair networks of this kind.

Direct repair programs (DRPs) and carrier programs are arrangements where a carrier sends its insured customers directly to a vetted list of contractors. Same idea: the carrier or TPA controls the flow, and you agree to their terms to get on the list.

The referral flow itself is straightforward. A loss happens, the customer calls their carrier, the carrier or its TPA assigns the job to a program contractor, and you do the work under the program's pricing and documentation rules. The customer is technically yours to serve, but the relationship and the next job belong to the program.

The requirements you sign up for

Being on a program is not free. In exchange for volume, most programs ask for:

• Prequalification: background, insurance, certifications, and sometimes a fee to join.
• Response-time service-level agreements (SLAs): on site within hours, with penalties for missing them.
• Documentation and photo standards: heavy, specific, and audited.
• Pricing concessions: program rates that sit below what you could charge a private-pay customer.
• Referral or fee cuts: a percentage off the top of every job.

Have the agreement read before you sign it, not after. These are commercial contracts, and the terms that hurt are rarely the ones in the pricing table. Look specifically for minimum-volume or exclusivity commitments, indemnity and hold-harmless language, audit and clawback rights over closed files, unilateral amendment clauses that let the program change rates or rules without your agreement, and the notice period and any penalty for leaving. Have your own attorney read it. Signing a program agreement you have not had reviewed is how a volume decision becomes a legal exposure.

What participation costs before it pays. Program work comes with a shopping list. A franchisor or a managed repair program will often require specific estimating, documentation, or compliance software as a condition of staying on the list, and the contractor carries that cost whether or not any volume follows. No floor is attached. A shop can pay for the required stack every month of a year in which the program sent less work than it did the year before. Price that stack as part of what the channel costs you, not as general overhead, and set it next to what the channel actually paid. Plenty of owners have never run those two numbers side by side.