Poor hospital network of TPAs dents Mediclaim cashless service plan

Soumya Viswanathan & G Sankar Narayanan - Mumbai/Chennai

Mediclaim cashless service introduced by general insurance companies is yet to take off. It has been six months since the four public sector insurance companies - New India Assurance, United India Insurance, National Insurance and Oriental Insurance - launched the Mediclaim cashless service, but 80 per cent of claims still continue to be reimbursed. In other words, cashless service has been effective in only 20 per cent of the claims.

The Insurance Division of the Ministry of Finance has cited the weak hospital network of Third Party Administrators (TPAs) as the main reason for cashless Mediclaim not taking off as proposed. ‘‘In big cities, the number of hospitals under the TPA network are inadequate. As a result, 80 per cent of policy holders go to small and medium hospitals for treatment and these institutions are not in the network. This is the main reason for such high levels of reimbursements,’’ S K Mahapatra, secretary general, General Insurance Public Sector Association (GIPSA), told Express Healthcare Management.

Says Dr Prabhakar Rao, a member of the Association of Medical Consultants and a Mediclaim policy holder, ‘‘I live in Mumbai suburbs, but my TPA has only two tertiary care hospitals such as Breach Candy and Jaslok on its panel, while I find it convenient to go to a hospital in the suburb.’’

The Finance ministry is now calling for expansion of the TPA hospital network by inviting more hospitals to get empanelled with TPAs. Last month, the Division appointed four nodal TPAs (one for each region) to process new applications. The four nodal TPA appointed include Paramount Health Services for the Western region, Medicare for East and North, and TTK and Family Health Plan in the South. These nodal TPAs would also take upon the task of improving the system by exploring options of grading and standardising hospital procedures like billing and admission procedures.

GIPSA is planning to convene a meeting this month to review the service levels of 10 TPAs appointed by public sector insurance companies to discuss and implement steps suggested by the finance ministry, S K Mahapatra said.

Besides weak network, infrastructure at the TPA level is also blamed for high number of reimbursements. The primary complaint is delay in issuing identity cards to policy holders. ‘‘Policy holders have been complaining that they have not got their cards. Without identity cards, hospitals refuse to provide cashless service to the patients,’’ says Subhash Wasnikar, divisional manager, New India Assurance. Subir Bhattacharya, manager, United India, admits that they have received complaints on delay in issuance of identity cards, delay in claim settlements, etc against TPAs.

But TPAs say patients are not yet used to the system of cashless service and it will take some time. ‘‘Patients do not carry identity cards or there are instance where patients do not furnish sufficient medical details for pre-authorisation by TPAs. Patients also do not go through the information brochure sent by TPAs leading to inconveniences, says Dr Nayan Shah, managing director, Paramount Health Services.

TPA service is another sore point among policy holders. ‘‘My TPA sent me the list of hospitals only after I called and fired them,’’ says Dr Rao. Mediclaim subscribers feel the they should also have the choice of TPAs. Another policy holder said despite his TPA mentioning a name of a particular hospital in Mumbai in its panel, treatment was refused to the policy holder. The reason offered was that the particular TPA was not recognised by the hospital. ‘‘If I had the choice of TPA, I could have ensured that this does not happen,’’ he says.

The problems facing effective implementation of cashless service extend to hospitals as well, say experts.

Both insurance companies and TPAs say these are early days and problems are bound to exist, which will be sorted out soon. ‘‘It is true that most TPAs have failed to issue identity cards. But, these are due to teething problems, which will be sorted very soon. Adds Mahapatra, ‘‘It is too premature to review and judge the TPAs. It is a learning process for them too and also for insurance companies and policy holders.’’

Another problem is the surge in patient base. Earlier, TPAs used to pay deposits to the hospitals for cashless service. But, with increasing patient base, it is not possible to do so, say TPAs. ‘‘For a hospital, the number of cashless service has increased five times after Mediclaim began offering cashless service,” says Dr Nayan Shah.

Insurance companies and TPAs assure that they are working towards building an efficient system. GIPSA plans to launch awareness campaigns on TPA services, while TPAs plan to hold seminars to educate the stake holders on the evolving changes in the health insurance sector and on how to gear up to meet the challenges.

But, experts say, public sector insurance companies need to gear up pretty fast to match consumer expectations. How serious are insurance companies in building up an efficient system remains a question mark as Bhattacharya says, ‘‘we can always fall back on the old one ifthis fails.’’

soumya@expresshealthcaremgmt.com

umgsankar@yahoo.com