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IRDA to follow HC direction on resuming cashless facility

Insurance regulator IRDA today said it will follow the Delhi High Courts direction to take steps on resuming cashless facility to policyholders provided by four PSU general insurers.

Now that HC has given direction, we will follow that, IRDA Chairman J. Hari Narayan told reporters on the sidelines of a FICCI event here.

On Tuesday, the Delhi High Court had asked IRDA to make some arrangement to provide cashless facilities to policyholders, amid the suspension of cashless treatment facility at several big hospitals by four public sector general insurers - New India Assurance, United India Insurance, National Insurance and Oriental Insurance.

The Insurance Regulatory and Development Authority (IRDA) should, as a regulator of the insurance industry, intervene and ensure that such changes do not affect existing policyholders ...,? High Court Justice S. Muralidhar had ruled.

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Experts from Medimanage.com give their opinion:

Sudhir Sarnobat:

Sudhir Sarnobat from Medimanage.com

With judiciary getting involved in the matter, the consumers would benefit for the short term but the health insurance industry needs long-awaited reforms. If these reforms are not undertaken now, the insurers will simply charge more premium to recover the losses without bringing in the efficiency drives.

With an inefficient system, nobody benefits in long-term & we continue to hold our view that the changes are MUST.

The idea of differentiated products is good but those should be based on sound underwriting principles with innovation in risk management & a higher premium product for big hospital is not what we need now. The thought process for such products emanates from Insurer’s outlook of If-you-want-big-hospital-you-pay-big-money.

10-day time limit for hospital

NEW DELHI: The standoff between insurance companies and private hospitals over cashless treatment continues, defying hopes of millions of Mediclaim policy holders for an early resolution.

The four major public sector health insurance companies, which control 80% of the business, have now set a 10-day deadline for four major chains of hospitals — Apollo, Fortis, Max and Medanta — to come up with their packages for common treatments to avail cashless services.

The tough-talking by PSU insurers — National Insurance Company, New India Assurance, Oriental Insurance and United India Insurance Company — came after month-long negotiations failed to bring these hospitals on board for standardized treatment packages. These hospital chains, along with 100-odd other hospitals in Delhi NCR and a similar number in Mumbai, Bangalore and Chennai, had been taken off the network of hospitals for cashless services on July 1. The withdrawal of cashless service was a delayed action against hospitals that were allegedly overcharging for treatment.

The IRDA chief blasted 5-star hospitals for inflating bills and justifying their costs in the garb of quality service. Harinarayan said if a treatment costs $50,000 in US and the same comes for $5,000 in India, the latter cannot be termed inferior simply by the difference in their costs. His remarks came in response to Shivendra Mohan Singh of Fortis chain who said insurers could not make a common package and club 50 hospitals all providing different quality of services.

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Experts from Medimanage.com give their opinion:

Sudhir Sarnobat:

Sudhir Sarnobat from Medimanage.com

Though the efforts being made are progressing well, the insurers should apply the rule for all insured members, without discriminating them on basis of Individual or corporate member. The packages & low rates applied for are basically outcome of volume of business given by the insurers to the TPAs. The amount of noise that is made by the hospitals about this decision by the insurers & TPAs confirms that the big hospitals need the insurance business badly & that’s what will bring them to the negotiation table & make them refrain from activities which are unethical.

Insurance companies & TPAs have partly achieved their objective & they should now continue the focus & get the packages at discounted rates approved from the hospitals. However, in long term, they need to restrict the cashless to few hospitals which would result into more volumes at those hospital which can result into reduction into the rates further.

Health Insurance Companies to extend cashless facility in emergency and trauma cases

MUMBAI: In a major relief to health insurance policy-holders, public sector insurance companies have announced that cashless treatment will be extended to all hospitals in emergency and trauma cases.

During a healthcare meeting with the Confederation of Indian Industries (CII) in New Delhi on Friday, New India Assurance Company chairman M Ramadoss said a patient who requires emergency and trauma services will be attended to through the cashless scheme in all TPA-empanelled hospitals.

An official from the PSU said that emergency and trauma cases will have to be certified by third party administrators (TPAs) in order to avail of the cashless benefits. There are a total of 24 TPAs which are linked with the Gipsa (General Insurance Public Association), a body comprising the four public sector general insurance companies — New India Assurance Company, National Insurance Company, Oriental Insurance Company and United India Insurance Company. The official said that planned or elective surgeries such as bypass, knee replacement and cataract among others, do not fall under the category of emergency or trauma cases.

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Experts from Medimanage.com give their opinion:

Sudhir Sarnobat:

Sudhir Sarnobat from Medimanage.com

This is a welcome change & as we had always maintained, a dialogue between insurers & the hospitals only can bring this imbroglio to successful resolution.

As mush the hospitals need the Insurers to maintain their revenues, the insurers need the Tertiary care hospitals to ensure that the high-cost treatments are offered to their customers on cashless basis. The changes in the health insurance market are just beginning & the industry will have lots of up-downs In near future and will continue to remain in news.

 
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