Govt Set to Stop Monopoly in RSBY Insurance
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09 July 2010
Health Insurance for Poor
Taking note of the largescale complaints from hospitals in the implementation of the Rashtriya Swastha Bima Yojana (RSBY), the state government is set to end the monopoly of ICICI Lombard in providing insurance to the economically deprived sections.
In a bid to provide better services, the state is looking at introducing new players by dividing the bidding process in three phases. Although most states have a single company providing insurance cover to the poor under RSBY, Maharashtra follows a different model with several companies involved in the process. And while the state government is studying the Maharashtra model, it wants to formulate a model of its own. Sources in the Rural Development department said in the first phase, the government has decided to open bidding in 14 districts of the state, followed by 40 in the second. The rest are to be covered in the third phase.
The bidding for the first phase took place a few weeks ago and United India Insurance emerged as the lowest bidder, quoting around Rs 390 as the yearly premium to be paid by the government per beneficiary. Though this makes United India Insurance most eligible for the first phase of the project, government officials say the exceptionally low premium has raised doubts about whether the company will be able to deliver satisfactory services at such low rates.
At a meeting of state officials in Lucknow on Wednesday, it was decided to give the new company a chance. Regarding this, Commissioner (Rural Development) Sanjeev Kumar said: “We are working on the possibilities. United India Insurance is the lowest bidder, but nothing has been finalised yet.” A senior official said that ICICI Lombard had agreed to work on the figure of Rs 575 as the annual premium to be paid by the government per beneficiary.