Cashless Hospitalisation Delayed As Tpas Cry Foul

Cashless hospitalisation for Mediclaim policyholders, which was expected to kick off from July, seems unlikely in the near future as state-owned insurers have failed to tie up with third-party administrators (TPAs).

The setback follows the exercise of empanelling nine of the 20 licenced TPAs by the General Insurers' Public Sector Association (Gipsa) going for a toss.

Gipsa had in June shortlisted nine TPAs for selection by the four state insurers based on technical and financial basis. The selection met with resistance by those TPAs which were left out since state insurers account for more than 99 per cent of their business. The Mediclaim market has a premium income of Rs 500-600 crore, covering four million lives.

Following the protest, Gipsa last week sent letters to the insurers stating that they would have to appoint TPAs on their own. Apart from shifting the burden of hiring the TPAs on the insurers, the Gipsa also put two riders, stating that individual companies can at best appoint five TPAs, and that each TPA can have interest in a maximum of two zones.

This has resulted in a canvassing campaign by TPAs which are looking at the West and South, where there is maximum business, said an official from a Mumbai-based TPA. "Many are pulling strings and trying to get politicians to canvas for them," he said.

"Pre-fixing of the number of TPAs that each company can take on by Gipsa is not viable. It ought to have allowed insurance companies to identify the number of TPAs required as per their needs, that is, in terms of the population. Each insurer has also different needs in each zone, depending upon the size of business," said S K Mahapatra, an expert in healthcare business.

"New companies do not have too much business to offer today having covered only 70,000 lives thus far," Akshay Jain, CEO, Medicare Foundation Pvt Ltd, said. The Goa-based Medicare Foundation was one of the nine TPAs selected by Gipsa.