PSU insurers extend deadline for receiving TPA application

The four state-owned general insurers have extended the application deadline by three weeks to September 24 for setting up a common Third Party Administrator (TPA), even as impasse over the suspension of cashless facilities continues.

The four PSU insurers — National Insurance Company, New India Assurance, Oriental Insurance and United India Insurance — had invited expressions of interest from companies for forming a joint venture TPA.

“The deadline for EoI has been extended to September 24, from September 3 earlier,” General Insurers Public Sector Association (GIPSA) Chief Executive A K Singhal said.

The partnership is expected to commence operations by June 30, 2011.

TPAs are firms to which insurers outsource servicing of health claims. After the insurance companies issue the policy, almost all the back office work, including networking with healthcare providers, are undertaken by TPAs. In return, they get around five per cent of the premium as fees.

Following the row over excessive billing, the four PSU insurers, with effect from July 1, 2010, took off about 150 hospitals from the preferred provider network (PPN) list that provide cashless hospitalisation services to policy holders under the mediclaim scheme.

While the insurance regulator expressed hope that the row would be resolved soon, hospitals do not seem to share the optimism, with Max India Chairman Analjit Singh saying there is currently “zero consensus” on the issue.