Insurers clip TPAs’ wings

Kolkata: Bugged by ‘upfront cash payment’ issues when admitting someone to hospital? Don’t worry, help is at hand.

General insurance companies covering over 85% of mediclaim policies issued in India have decided to make payments of claims directly to health service providers (or hospitals etc) through some private banks instead of routing the money through third-party administrators (TPAs) as is being done now.

Insurance companies, TPAs and health service providers have been into a blame-game over payment of claims for quite some time now.

Many hospitals and nursing homes have often refused to admit mediclaim patients through the “cashless” option.

Some hospitals refuse the cashless option even after upfront payments because of the delay in receiving the balance money from TPAs, “in some cases for 9-10 months” said a hospital executive.

G Srinivasan, chairman and managing director, United India, said the company has already initiated making payments through its designated banks instead of TPAs.

V Ramasaamy, chairman and managing director, National Insurance Company, and M Ramadoss, Oriental Insurance chief, are following suit.

TPAs will now process the claims and send it to the bank, which, in turn, will make the payment directly to the health service provider.

Insurance companies have been conducting quarterly reviews of TPAs, which involves auditing and checking of their records and flow of funds.

The potential of the health insurance, which is around Rs 5,500 crore at present is said to be Rs 40,000 crore by 2020 and expected to grow by 35% for the next five years.

Source: DNA Money