Insurance policies can now get the discounts that the insurers avail from the hospitals. This will be pertinent for both cashless and reimbursement of the claims. This move will cut down the hospital expenses incurred by the policyholders. The Insurance Regulatory and Development Authority of India (IRDAI) said that during the settlements of claims under health insurance policies, the insurers or the third party administrators are to ensure that the discounts that the hospital is providing will be passed on to the policyholder or to the claimant of the health insurance policy.
Due to the bulk nature of business, insurers always get discounts from the hospitals and from their network providers. Now when a claim is being settled, the insurers or the third party administrators are to ensure that they identify the discounts appropriately and allocate the suitable amount of the discount to the underlying health insurance plan. IRDAI is doing this in order to pass the benefits of discount to the concerned policyholder or the claimant.
Hence the insurers and the third party administrators now have to direct the hospitals to reveal the agreed upon discount in the final hospitalisation bill of the each claim. This is being done so that the policyholder or the claimant knows how much the actual bill was and how much discount he received from the hospital.
The IRDAI has said that when the permissible claim amount is more than the sum insured, the agreed discount has to influence the gross amount raised in the bill before letting the policyholder or the claimant to endure the cost over the eligible claim amount.
The health insurance head at the Future Generali India Insurance Company Limited, Shreeraj Deshpande said that the Future Generali has its own health claims servicing setup and they do not take assistance of the third party administrators. The agreements with hospitals take care of the guidelines that make sure that the discounts or the agreed upon rates are to reflect on the actual bills raised to the insurer or the policyholder and therefore passing on the benefits that the hospital provides to the policyholder or the claimant.
According to the IRDAI, if the health insurance policy has any co-payment or any deductible conditions, the insurer or the third party administrator must make sure that the co –payment or the deductible is effected only after netting the discounts offered by the hospital.
Rahul Agarwal, the founder director of the Ideal Insurance Brokers says that this is a welcome move and it will bring transparency in the system and help in checking the health insurance premiums which have been increasingly steady because of the high claims ratio. He also says that it will bring parity to the health care costs in the long run and ultimately the insurance industry will benefit as a whole.
Hospitals provide discount on the check-up fees and procedures, IVF treatment, Cancer treatment, surgeries, ophthalmological procedures, mastectomies and neck dissections, discount on consultation and annual health check-up and policyholder can avail discount on the hospital room charges and operation charges.
A former IRDAI member, K.K.Srinivasan, told that there have been growing suspicion that the third party administrators are getting paid directly by the hospitals based on the amount of insurance claim settlements and this proposed measure will help curb the unethical practices if they were prevailing. He also said that it will help the insurers to control the claim cost and which will benefit the policyholder as a saving in the claim cost is passed on to the policyholder as a way of reduced premium. Whereas increased claim costs are passed on to the policyholder by way of increased premium.