Insurers seek healthcare regulator for streamlining hospital services

Faced with ever-rising healthcare insurance claims, the General Insurance Council, which represents the interests of 25 non-life insurance companies, has demanded the setting up of a regulator to oversee the healthcare industry and prescribe norms for standardisation and inspection of services across hospitals.

Blaming the rising health insurance claims on the sub-standard healthcare services that many hospitals provide the patients, the council said the services cannot be left unregulated or unchecked.

The council made these submissions in response to a public interest litigation filed by activist Gaurang Damani in the Bombay High Court seeking declaration of pre-package rates for various ailments in the policy document by non-life insurance companies.

According to the council, due to lack of clarity on standardised rates for different medical procedures by hospitals, insurers cannot pre-declare package rates for 42 standard ailments in policy documents.

Damani told the Bombay High Court on Thursday that pre-declaring package rates will bring transparency to the consumer who will know the exact amount to be reimbursed for a claim.

''Currently there is no clarity on the amount that will be reimbursed for a particular ailment. The discretionary power on settling the claim is with the insurer at present due to which in many cases consumers are forced to turn to the court,'' he pointed out.

In its affidavit submitted to the court, the council said it was not possible to determine standard protocols and estimates of the cost of various ailments as hospitalisation cost depends on various factors such as location of the hospital, clientele, quality of service, including hygiene, infrastructure facility in the hospital, availability of experienced surgeons and doctors attending on the patients and the cost and quality of medicines provided.

''A more pragmatic approach is to consider a regulator to monitor the pricing practices of hospitals and also having a uniform grading/ pricing mechanism for them. This would remove ambiguity wherein each insurer views a hospital differently as well as the disadvantage perceived by the insuring public,'' the council stated in the affidavit.

Meanwhile, the insurance regulator IRDA has come out with a list with a unique identity code for 30,000 hospitals, to help streamline and identify the charges for different treatments.