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:
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.