The term “ASO” stands for Administrative Services Organization.
The term has two connotations, one used in Business Process Outsourcing and one for Group Healthcare Benefits.
In HR Outsourcing, An ASO oversees the day-to-day administrative aspects of managing a company’s HR functions. Unlike a PEO arrangement, the client company remains the sole sponsor of all benefits and insurance coverage when working with an ASO and maintains all fiduciary responsibilities.
In Group Health Care plans an ASO plan is used by employers who self-fund employee health benefits instead of purchasing health insurance for their workers. These employers pay claims out of their own pocket and hire a third-party administrator, often an insurance company, to run the program and process claims.