Pay Higher Premium, Go Cashless To Big Hospitals: Insurance Plan In The Works
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04 August 2010
New Delhi, India
To break the stalemate with big corporate hospitals, the four state-owned insurers are planning to introduce a new variant of health cover – the Premium Mediclaim. Subscribers will be charged a premium higher than that of a regular health insurance policy, but will be offered cashless facility at all major hospitals on the insurer’s network.
“Big hospitals have agreed to revise their package rates and share it with us in a few days. We will compare it with a list of‘reasonable rates’ that we have prepared in consultation with doctors and third party administrators (TPAs). If they are within a reasonable range, it is fine. Else, we may introduce a premium product for customers who insist on getting treated at 5–star hospitals,” an insurance official privy to the negotiations told The Indian Express.
The four general insurers – National Insurance, New India Assurance, United India and Oriental Insurance – had taken about 150 hospitals, including the big ones, off their network list from July 1 following instances of differential treatment and charges for insured patients.
The insurers have alleged that the big players in the healthcare business overcharge patients who have insurance, leading to losses for the insurers. PSU insurers are currently not offering cashless facility at these hospitals except in the case of emergency services.
Health insurance is a fast–growing industry, but it does not bring profits to insurers. Despite premium collections having jumped 500 per cent since the financial year 2004, the claim ratio has not changed. For FY 2010, the gross claim ratio of health insurance companies stood at 105 per cent. After accounting for acquisition cost and other management expenses, the claim ratio rises to over 140 percent.
"If we allow big hospitals to inflate medical costs at this rate, good healthcare will be out of reach for the poor. India will become like western countries, where medical costs have now shot through the roof," said the official.