Govt insurers' plan for common TPA shelved

Government-owned insurance companies' plans to set up a common third party administrator (TPA) have come to a halt as stringent norms, discrepancies in tender conditions and selection procedures kept away prospective bidders. Mahua Venkatesh reports.

Government-owned insurance companies' plans to set up a common third party administrator (TPA) have come to a halt as stringent norms, discrepancies in tender conditions and selection procedures kept away prospective bidders.

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General Insurers Public Sector Association of India (Gipsa), the association of these four companies, which was carrying out the TPA's formation, has called the bid off.

Public sector insurers, saddled with commercially unviable claims, were planning to form a common TPA to cut down on costs.

"The qualifying criteria were stringent and unviable. Bidders were required to present a minimum networth of Rs 150 crore and some conditions were inserted later much after the bids were invited," said a source on the condition of anonymity.

The four public sector insurers - National Insurance Company, New India Assurance, Oriental Insurance and United India Insurance - together manage about R6,000 crore of health insurance business,

TPAs are the point of contact between the patient and insurance firms. TPAs carry out all administrative tasks on behalf of insurance firms and settle claims for patients who present a valid health insurance card.