In a good augury for the insured, a cashless medical settlement beckons Indian hospitals

If insurance sector regulator IRDA has its way, then 100% cashless facility will be implemented in all hospitals across the country within the next couple of months. This is undoubtedly a pragmatic futuristic move that brings along several positives.

Currently, cashless settlement is available in only around 50% of the hospitals, numbering around 25,000.

The insurance regulator has mandated the Committee on Common Empanelment Process of Hospitals and 100% cashless to submit a report on implementing fully cashless medical-insurance settlement in hospitals across the country.

More than 350 million medical insurance policyholders are likely to benefit once the plan is implemented.

Following the recent tiff between insurance companies and hospitals, IRDAI has been exploring ways to resolve such incidents in the future.

According to an August 1 order issued by the General Insurance Council (GIC) Secretary-General Inderjeet Singh, the committee will provide weekly updates, with an aim to introduce nationwide cashless settlement by the end of October. The panel is headed by S. Prakash, former managing director of Star Health and Allied Insurance Company. The committee has been asked to update on the developments on a weekly basis and complete the entire process by the month-end.

Alongside, Shekar Sampath Kumar, who had played a key role in standardisation of rates for medical procedures for PSU general insurers a decade ago, has been roped in by IRDAI as GIC’s director of health insurance for three years.

Kumar, an insurance ombudsman at Chennai, is expected to take up the new assignment by the end of this month, sources familiar with the development have confirmed.

In his new role, Kumar, who will be based in Chennai, will work towards bringing all hospitals under the cashless facility and implementing common procedural rates for them.

Talking to Bizz Buzz, Sudip Indani, National Head (Health & Benefits), Howden Insurance Brokers (India) says, “Many times, people struggle to identify hospitals in the insurer's network and, if not discovered, end up paying on their own and claiming afterwards, which produces a lot of difficulties, frustrations, and ruins what should have been a convenient experience. Many times, despite having insurance, customers do not have enough money to pay for hospital expenses and wind up borrowing at exorbitant interest rates as urgent cash for hospitalisation.” A few insurers, brokers, and TPAs are currently collaborating with a few Fintech businesses to bridge this gap and give interest-free money for a limited time if recipients have insurance, he said.

If all insurers develop solutions that allow members to go cashless at all hospitals, it would be a game changer for the health insurance industry and improve the insured experience, which will aid in increasing penetration. If this is successful, it will be an excellent move. There will undoubtedly be some glitches initially, but once resolved, it will be a worth the effort and expectations for the insured, he said.