NEW DELHI: There is a big impasse in India’s healthcare system right now. The Association of Healthcare Providers India (AHPI), which represents more than 15,000 institutions, has said that Bajaj Allianz General Insurance clients will no longer be able to get cashless hospitalization services. This change, which goes into effect on September 1, has caused instant panic among millions of consumers who will now have to pay for hospital care up front and then try to get their money back later.
The AHPI has also sent a letter to Care Health Insurance, giving the company until August 31 to fix the problems. This is making the crisis worse. If a solution isn’t found by the deadline, member hospitals will likewise stop offering cashless services to Care Health policyholders.
Aditya Shah, the founder of Hercules Advisors, has asked the Insurance Regulatory and Development Authority of India (IRDAI) to step in right away. Shah told NDTV Profit that the “end consumer has to face the brunt” of this conflict. “It’s not right that 15,000 hospitals have chosen to stop working with at least one insurance company. I believe the IRDAI should get involved. He said, “There has to be sanity in the system.”
Hospitals have been unhappy for a long time about low reimbursement rates and insurers’ slow processing of claims. This is at the heart of the disagreement. The AHPI says that although while medical costs in India are going up by 7–8% every year, the rates that insurance pay hospitals are still too low, making it impossible for them to stay in business.
Shah agreed with the hospitals’ worries and said that medical inflation is causing insurance premiums to go up all the time, but the money is not getting to the healthcare providers. He did say, though, that all sides are to blame for the deadlock. He remarked, “The hospitals are not equally to blame for this.” “Sometimes hospitals charge more than the MOUs (Memorandums of Understanding), which makes the insurers’ deductions go up.”
Shah told Bajaj Allianz and Care Health Insurance clients who were affected to be careful. He told clients to “wait and see” and not make “knee-jerk decisions” like transferring their insurance right away, because portability has its own problems. He said that portability should be seen as a “last-ditch attempt.”
Shah also told people who had insurance to check the cashless network and call hospitals to make sure their insurer is still on the list. He was hopeful that the regulator and government would step in to fix the problem because it affected so many people.
The General Insurance Council, which represents non-life insurers, has criticized the AHPI’s “unilateral approach” and asked for constructive communication to make sure that all health insurance policyholders can continue to use cashless services without any problems. The council said that the decision causes unnecessary complexity and makes people less likely to trust the health insurance system, especially in emergencies when being able to pay without cash is very important.