In accordance with consumer law, most insurance companies were earlier offering the cashless service to their consumers. In Cashless Service, when you get hospitalized with a network hospital, you do not have to settle the bill with the hospital. The Insurance Company represented by the TPA, co-ordinates with the hospital and settles the bill.

Health insurance companies make tie-ups with hospitals after negotiating their rates and checking their quality. These hospitals are called as Network Hospitals

Third Party Administrators are the representatives of the health insurance companies who are responsible for settling the claims both reimbursement claims as well as cashless claims. It is the TPAs who have to approve your request for cashless and provides the service.

Now, they are alleging that hospitals make false claims and show high costs so that they can charge more from the insurers. With the stoppage of this facility, it means that the consumers, who wish to use the services of these hospitals, will now have to pay cash. Only after making the payment in the hospital, they will be entitled to claim the insurance amount. However, the insurance companies offer no guarantee that they will be compensated the full amount. The concerned hospitals are outraged, by the decision. Their official stand is that insurance companies should comply with the legal process to penalize the culprits, instead of targeting established hospitals and impacting the patients.

At least 18 insurance companies, including public sector entities, have withdrawn the cashless mediclaim policy facility and stopped direct payment of treatment charges to high-end hospitals in Delhi, NCR and at other metros like Mumbai, Bangalore, Kolkata and Chennai from July 1.

This will put the policy holders, particularly the middle class patients, who do not have ready cash available with them at a disadvantage. Such a step will have adverse impact on the penetration of the health insurance market in India, as the Insurance firms have been giving cashless services at over 3,000 hospitals.

The Delhi High Court has pulled up insurance regulator IRDA for its failure to sort out a dispute between insurance companies and city hospitals due to which people having medical insurance are facing difficulties in getting cashless treatment.

Justice S. Muralidhar asked the Insurance Regulatory and Development Authority to take immediate steps so that patients who are insured can get the facilities of cashless treatment.

“You cannot leave patients suffering saying that meeting will be convened. Patients are not getting treatment because of dispute between insurance company and hospitals. It is your duty to act timely,” Justice Muralidhar said.

The court took strong exception to the remarks of IRDA chairperson published in a newspaper in which he was quoted as saying that it is a matter between the insurance companies and the hospitals and there is no regulatory issue involved in it.

The court was hearing a petition filed by one Vishal Ahuja whose 53-year mother, a cancer patient, was refused cashless treatment in the Dharamshila Cancer Hospital and other medical centres.

Turning down his plea of cashless treatment, the hospital authorities said that because of dispute between insurance companies and hospitals regarding reimbursement of medical bills, the companies have decided to discontinue cashless facility for individual policy-holders.

Mr. Ahuja then approached the Delhi High Court contending that he had paid extra premium to Oriental Insurance Company to avail the cashless facility and IRDA should be directed to settle the dispute between the insurance companies and the hospitals as it would take more than a month for getting reimbursement for treatment from companies.

With criticism, disbelief and consumer protests soaring, the Insurance Regulatory and Development Authority of India (IRDA) has decided to scrutinize the matter and take suitable action after discussion with all the stakeholders. In general, people across the country view this sudden change of policy, as breach of trust and contract by their insurance providers. Patients who are forced to pay hefty hospital bills in cash are sure to file legal suits as they would be blaming the insurers for their loss.

The dispute on cashless hospitalisation between the top corporate hospitals and the four state owned insurance companies may end soon. In a meeting held in Delhi on Friday, the chairman and managing directors (CMD) of the four insurance companies have asked top corporate hospitals to submit the package rates for various surgical procedures in the next 10 to 30 days. After which the two parties would negotiate to arrive at the final rates.

CMD of New India Assurance, M Ramadoss told Financial Chronicle, “We have invited the corporate hospitals to submit their rates for the 42 surgical procedures in a months’s time. After which we will hold discussions to finalise the rates.”

The meeting was attended by CMDs of New India Assurance, Oriental Insurance, United India Insurance, National Insurance, third party administrators (TPAs) and members of the CII’s national committee on healthcare that consist of top corporate hospitals.

DrPrathap C Reddy, Chairman of Apollo Hospitals said that the participating hospitals have expressed interest to give quality healthcare and cashless treatment to policyholders. From the hospitals, the meeting was attended by CMD, Medanta – The MedicityHspitals Group DrNareshTrehan, MD of Fortis Healthcare Shivinder Mohan Singh, Vice Chairman of Max India Tony Singh, MD & CEO of Max Healthcare Institute Dr Pervez Ahmed, CEO of Fortis Healthcare Bhavdeep Singh besides others.

Meanwhile at a FICCI health insurance conference, chairman of Insurance Regulatory & Development Authority, J Harinarayan said, “As on July 1 this year there were 328 hospitals that were empanelled by the public sector insurers for providing cashless hospitalization in Delhi, Mumbai, Bangalore and Chennai which has increased to 391 as on July 29. I hope that the issues between hospitals and insurers would be resolved soon.”

However Harinarayan reiterated that the withdrawal and re-negotiation of the cashless facility by insurance companies was not a regulatory issue. “But if there is contractual violation between the policy holder and insurance company, the regulator would step in,” he said.

Such a step will have adverse impact on the penetration of the health insurance market in India, as the Insurance firms have been giving cashless services at over 3,000 hospitals.

The Delhi High Court has pulled up insurance regulator IRDA for its failure to sort out a dispute between insurance companies and city hospitals due to which people having medical insurance are facing difficulties in getting cashless treatment

The chairman and managing directors (CMD) of the four insurance companies have asked top corporate hospitals to submit the package rates for various surgical procedures in the next 10 to 30 days.

The dispute on cashless hospitalisation between the top corporate hospitals and the four state owned insurance companies may end soon. In a meeting held in Delhi on Friday, the chairman and managing directors (CMD) of the four insurance companies have asked top corporate hospitals to submit the package rates for various surgical procedures in the next 10 to 30 days. After which the two parties would negotiate to arrive at the final rates.

 -LAWZ BUREAU