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When in doubt, raise premium

Calcutta, Oct. 28: Several hospitals and doctors here have turned down health insurance companies’ suggestion to standardise cost of treatment to neutralise their losses. A con-sensus prescription appeared to be a hike in premium.

At ‘Health Insurance: A Better Tomorrow’, organised by the Bengal Chamber of Commerce and Industry today, no one — the insurer or the insured — appeared happy with the cashless system, introduced in 2002 to make health insurance policies more popular.

In this system, patients do not pay for treatment. The insurance companies reimburse the hospitals through an agency described as a third-party administrator.

But the insured now complain about not getting timely authorisation from the administrators for hospitalisation, the hospitals allege delay in settlement of claims and the insurers complain about inflated billing by hospitals. “As on September 2006, insurance companies owe Rs 15.14 crore to eight hospitals in the city,” said Sumedha Sen, chief executive officer of Woodlands Hospital. “The due is pending for over three months.”

When medical insurance was introduced in 1986, the schemes were structured with limits on room rent, doctor’s fees and other allied costs, which often make over 60 per cent of a hospital bill. The government repealed these sub-limits in 1996.

The insurance companies suggested standardisation of hospital charges to get out of the mess. But the hospitals say it is impractical.

“In case of a cataract surgery, if you know a patient is not insured and cannot pay for a costly lens, we give a low-cost one. But if the patient has insurance, he or she is entitled to a better product,” said Dr Rabindra Nath of Rabindranath Tagore International Institute for Cardiac Sciences. “Even the cost of a pathological test by a good hospital and a local centre is not the same.”

Insurers are now considering increasing their premium and reintroducing the sub-limits. “From next year, we will no longer be allowed to cross-subsidise the loss-making medical insurance business with profits from other businesses,” said Nirmal Bhattacharya, senior divisional manager, National Insurance Company.

“So, insurers are working towards restructuring their medical insurance products, including a premium hike and reintroduction of sub-limits on expenditure, particularly room rent and doctors’ fees.”

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