The Hindu : Business : Non-settlement of mediclaims alleged

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Friday, Jul 20, 2007
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Business

Non-settlement of mediclaims alleged

Shyama Rajagopal

KOCHI: Mediclaim insurance holders are finding it difficult to get the promised facility. The “cashless” facility offered by the insurance companies, especially in the public sector, in arrangement with a third party administrator (TPA), has on many occasions provided more disservice to the customers and sullied the image of the insurance cover provider.

Over the last couple of years or so since the TPA came into the picture under the purview of the Insurance Regulatory and Development Authority, the customers have faced more difficulty than earlier to get their claims settled.

Teething problems

While the customers are crying hoarse about claim settlements, insurance company officials believe that TPA is a good concept, though there are teething problems. Any new system would require time to stabilise, said a regional manager of one of the public sector companies.

The TPA was introduced to detect and cut false claims, if any, in mediclaim that had been bleeding the segment of medical insurance business. The claims ratio in mediclaim for all the four public sector companies in Kerala region has been either around 100 per cent or more.

The National Insurance, which collected Rs. 17 crore of premium in medical insurance in 2006-07, has had 124 per cent claims ratio.

New India Assurance had around 100 per cent claims ratio for a premium of Rs 9.5 crore, while Oriental Insurnace had a claims ratio of 98 per cent with a premium of around Rs. 9 crore.

Though the TPA was introduced to strengthen the functioning of insurance companies for better coordination with hospitals and customers, the TPA agencies till now have become more of a disservice to the customer, except in some cases, said P. P. Mohanan, State vice-president of the General Insurance Officers All India Association.

The customer certainly does not like when claims are being slashed or repudiated, said a senior official in one of the public sector insurance company. But, in quite a few genuine cases too, the TPA has harassed customers. According to a senior official in Oriental: “We have had problems. We are considering to have a tie-up with another TPA.”

Oriental has a tie-up with Family Health Plan (FHP) and TTK Healthcare Private Ltd. National has a tie-up with FHP, TTK and Medi Assist India, New India has a tie-up with Medi Assist and TTK while United India Insurance has a tie-up with FHP, TTK and Medi Assist.

The TPA, while cutting down the claims, takes no responsibility for the company’s goodwill in the market, said Mr. Mohanan. They work with little infrastructure and some of them take long to settle claims, he said.

The complaints have been coming mainly for claims being scrutinised by FHP as the company is closing operations, said some of the officials in the insurance companies. However, another official said they could wind up only after they settle all the claims and hold till the period the policies elapse.

Most of the hospitals do not entertain the “cashless” facility extended by the TPAs because of earlier experience of delay in claim settlements. Hence, the customer fails to get the “cashless” service, he added.

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