Health insurance grid might cut costs for getting covered

The Insurance Information Bureau (IIB), along with the Insurance Regulatory and Development Authority (Irda), plans to engage with hospitals, insurance companies and third-party administrators (TPAs) to maintain a health insurance and information grid. This, say insurers, will enable them to plug the loopholes in the health insurance space.

The first step that has been taken by IIB is to bring out unique identity numbers for hospitals. This would enable insurers to engage only with those hospitals that have been registered.

“There have been instances wherein there are two or more hospitals with the same name. Unique identity numbers will enable us to plug the loophole. In the long run, since data will be transparent, health insurance charges can also be capped,” said the chief executive of a private general insurance firm.

The executive added that after a certain period, all existing agreement renewals with hospitals will be dependent on registration with IIB for the unique number.

Going forward, this could also have a defined data centre for various procedures by medical institutions. Irda Chairman T S Vijayan had earlier said it would help the authority identify hospitals and collect information on the charges for different procedures.

"Unique identity numbers will be integrated with the pin codes of the areas and the names of hospitals. We are collecting transactional data from health insurers. We will then be able to know how much is charged for a particular procedure, by one hospital versus another hospital," said Vijayan.

IIB is an independent body that is involved in analytics and data collection/upgradation for the insurance sector. The bureau is involved in collecting health insurance data based on the different transactions with hospitals from insurers and TPAs.

The health grid will also be beneficial for the customers. Sanjay Datta, head of underwriting and claims, said the health grid would act like a health exchange that could be the vital connect between the insurer, health service provider and insured.

IIB officials said they had begun with 380,000 hospitals and zeroed in on 30,000. R Raghavan, CEO of IIB, explained the hospitals would be identified by their pin code, title and address.

"This will enable the industry to have data on the list of hospitals and the charges for different procedures. If new hospitals join the system, they will be added to the list," he said. This will help the health insurance industry to have a better managed system of insurance claims. In the long run, this will also bring transparency in healthcare costs and eliminate discrepancies, said industry officials.

"Today, there are several hospitals that charge a different rate when a patient has a health insurance policy. With the grid in place, this malpractices will come to the attention of the regulatory bodies and effective measures can be taken, leading to reduced cost for insurers, which could be passed on to customers," said the general manager of a public general insurer.