Private health insurers may follow PSUs in ending cashless facilities

Private sector general insurers may follow their public sector counterparts in discontinuing the cashless facility to hospitals that do not agree to the package rates proposed by the insurers, (See: Cashless mediclaim only on our terms, insist insurers) . Health has become a loss making segment for the industry.

With public sector insurers taking the lead in removing a number of hospitals from their preferred provider network (PPN) on the ground that they inflate bills, the private sector players consider this the right time to follow suit, according to Hindu Business Line.

Public sector insurers have an almost 60 per cent share in the health insurance market.
Private players are waiting for the hospitals and the public sector insurers to resolve the issue before evolving an industry-level framework on PPN.

''There has always been a need to control the claims payout in health as the loss ratio in the health insurance segment is as high as 120-130 per cent.

For Rs8,000 crore premium collected by the industry, the claim outgo is more than Rs12,000 crore. We will look to evolve a basic framework at an industry level to restrict the hospital network,'' an official with a private sector company told the paper.

S L Mohan, secretary-general, General Insurance Council, said that once the issue is settled between public sector insurers and hospitals, the council could help the private companies by giving them collective guidance. ''A basic framework could be evolved by the industry that hospitals would have to agree to for being a part of the PPN,'' he said.