Guidelines for health insurance sector to be formulated soon

The issues pertaining to claim settlement for health insurance and the availability of cashless-facility are soon likely to be resolved. Kanchan Chaudhari reports.

The issues pertaining to claim settlement for health insurance and the availability of cashless-facility are soon likely to be resolved.

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The Insurance Regulatory and Development Authority (IRDA) on Tuesday informed the Bombay high court that it is in the process of framing comprehensive regulations for the health insurance sector.

“The IRDA will soon come out with substantial regulations specifically for health insurance sector,” Paritosh Jaiswal, counsel for the regulatory authority informed the division bench of chief justice Mohit Shah and justice Roshan Dalvi. The counsel will inform the judges on October 17, when these regulations are likely to see the light of the day.

The court was hearing a public interest litigation filed by civic activist Gaurang Damani seeking transparency in settlement of medical insurance claims. In his PIL, Damani had pointed out that till date health insurance has not even been classified as a life insurance or non-life insurance.

“There are absolutely no rules stating how and in how much time should claims be cleared,” said Damani, adding, “No guidelines are framed by the IRDA.”

He complained that the third party administrators (TPAs) are given discretionary powers in settling claims and their endeavour is to reduce the claim to the minimum as they are given financial incentives for reducing claims, because of which ordinary consumers are suffering.

Damani further complained that the TPAs had virtually become de-facto insurance companies and they were settling the claims. Jaiswal, however, maintained that the TPAs are not empowered to settle the claims, and in fact they are not settling the claims.

Denying the allegations of the petitioner that cashless facility was withdrawn in July 2010, Jaiswal said that the facility was never withdrawn and 170 nursing homes and hospitals are providing this facility in the city.

Damani, however, pointed out that the number was negligible in comparison to 1,500 nursing homes and hospitals, which were providing cashless facility to insured patients. The PIL has now been posted for further hearing on October 17.