Finance ministry seeks Claims portal control from health ministry

The department of financial services, under the ministry of finance has sought the Prime Minister's Office (PMO) regarding the same

To improve transparency in health insurance claims, and reduce consumer grievances, the finance ministry (FinMin) is seeking control of digital platform National Health Claims Exchange (NHCX) that is currently under the purview of the health ministry.

The department of financial services (DFS), which is under FinMin, is already in touch with the Prime Minister’s Office (PMO) regarding the same, a senior government official said on condition of anonymity. 

“The idea is to bring insurance companies, healthcare providers, and insured individuals on a single platform to enhance transparency and ensure better regulation under the Insurance Regulatory and Development Authority of India (Irdai),” the official said. 

NHCX connects insurance companies, healthcare service providers, and government insurance scheme administrators to streamline healthcare access and claims. 

“We aim to make the health insurance claims process far more transparent and robust. Currently, in several cases, it has been observed from insurers and regulators that hospitals tend to inflate bills for insured individuals,” the official said. The source added that this will also improve the bargaining power of both hospitals and insurers. “Taking it under Irdai will help insurance companies more in terms of bargaining with healthcare providers,” the official said. 

Irdai is the apex body responsible for regulating and promoting the insurance and reinsurance industry in India. Irdai also ensures fair treatment of policyholders, maintains financial soundness of the industry, and frames regulations to ensure clarity in operations. 

According to government data as on July 21, 2024, 34 insurers and TPAs (third party administrators) are currently live on NHCX, and approximately 300 hospitals are preparing to start sending their claims on the Exchange. 

Minister of state (MoS) for Finance Pankaj Chaudhary, in a written reply in the Lok Sabha on March 17 this year, had put out the number of policies, premium, and claims with respect to health insurance business in 2021-22 (FY22) — approximately 2.26 crore policies were issued with premium collections totalling ₹73,051 crore while 2.19 crore claims were paid out amounting to ₹69,498 crore. FY23 saw policies flat at 2.26  crore but premiums jump to ₹89,491 crore, with 2.36 crore claims worth ₹70,930 crore paid. The growth accelerated further in FY24, with 2.68 crore policies, ₹1,07,681 crore premiums, 2.69 crore claims, and ₹83,493 crore disbursed. 

On the increase of health insurance premiums, Chaudhary in the same reply said that in policies, premiums are structured based on several factors, including the age of the policyholder, with older individuals generally facing higher premiums due to increased health risks. “The sum insured for greater coverage amounts leads to higher premiums. The specific coverage options selected, such as additional treatments or enhanced benefits, may also drive the premium up,” he said. 

The minister further added that insurers look into factors such as actuarial principles, claim experience, morbidity, medical inflation, medical conditions, pre-existing diseases, commission, expenses of management, interest rates, cost of capital, product features, etc. in computing/revising the premium.