New Delhi: Locked in a battle with big healthcare firms over censoring cashless health insurance claims, state-run insurers today asserted that the facility would be extended only to those hospitals that agree to their rates for medical expenses.

“The purpose of working out such package rates and stabilising the hospitalisation costs, will benefit the insured in many ways,” the four state-run general insurance companies — National Insurance Co, New India Assurance Co, Oriental Insurance Co and United India Insurance Co — said in a joint public notice.

Presumably hurt on their balance sheets by the allegedly inflated bills for medical costs of people covered by cashless mediclaim facilities, these insurers have pruned the list of hospitals in four large cities for providing this facility with effect from this month.

The selected list of hospitals in Delhi and National Capital Region, Mumbai, Chennai and Bangalore, does not include big chains like Fortis and Max Healthcare and was prepared on the basis of those accepting rate packages prepared by the insurance firms for medical procedures and hospitalisation costs.

While the insurers’ move has been vehemently opposed by large hospitals, the general public has also been caused inconvenience as settlement claims for many of them were refused at the hospitals not on the preferred list for such a facility.

A conciliatory meeting was arranged between the insurers and the hospitals in Mumbai on July 13, after which the insurance firms agreed to work upon expanding the list of approved hospitals for cashless facility.

In today’s statement, the four public sector insurers that together command nearly 65-70 per cent health insurance market share, however, made it clear that only those hospitals would be included in the list that adhere to its conditions on medical costs.

“We along with some TPAs (Third Party Administrators), worked out package rates for some of the procedures/hospitalisation expenses, which are commonly claimed under our health insurance policies,” the statement said.

Having offered these rate packages to various hospitals over a period of several months, those agreeing to the offer were included in a “Preferred Provider Network”, or a network of hospitals where cashless mediclaim facilities would be available, the insurers said.

For treatment at non-PPN hospitals, the policy holders would need to seek reimbursement of expenses later.

Under cashless facility, the policyholders do not need to first pay the hospitals and later claim the expenses. Instead the insured sum gets deducted from the medical bills in the very first place.

[Story Source]

This post was submitted by Harshit Agrawal.

“THIS is the third call I’m getting today from an insurance company”, Shashank fretted to his friend Sudhir. Sudhir looked up from his work and just said, ”What’s new? I got four calls today, myself”.

Not surprising. For many it is a new calling (pun unintended). Insurance has become the refuge of many a mutual fund distributor, as that business has folded up since August 2009.

The insurance agents have quite a few tricks up their sleeve. Not everyone is bad and uses these unsavory tricks. But, you better know them. Here they are:

1) Old wine in a new bottle

The agent is constantly on the lookout for business. If organic growth becomes a problem, existing patrons come in handy! That is when you get calls to surrender the three year old ULIP (unit linkedinsurance plan) to put it in, what else but another ULIP or ULIP based pension plan.

Only that the insurance product charges are front loaded and you would have just completed paying most of the charges in the first product and now you could start off with the second one.

2) Government guarantee!

This is a ploy used by LIC (Life Insurance Corporation) agents. They keep talking about sovereign guarantee. Guarantee in a traditional product is only for the sum assured. Everyinsurance company (including private players) guarantees the payout of the sum assured. It is only the bonus payout that is not guaranteed. For ULIPs, this anyway does not apply. So, this is a total con game.

3) New products that no one has heard of

Heard of Jeevan Amrit or Jeevan Sadhana? These are not LIC plans. They are plans conjured-up by putting together a few insurance products of LIC . Also, interestingly, the payouts which come in at various points are assumed to be invested in National Savings Certificate, Public Provident Fund, RBI Bonds etc. Then they calculate the returns and tell you that their Jeeven Amrit or Sadhana gives 8 -10%. Don’t be misled by this. The higher returns are because of these other products, notinsurance. I have still not understood why they should show reinvestment in other products, when they are talking about insurance. And, how someone falls for these.

4) 6 & 10% returns in a traditional product

Recently, I found that a client of mine has gone for Jeeven Saral, a traditional policy of LIC. However, the agent had given an illustration with 6% & 10% returns! This was to be used for ULIP policies, where this is a possibility. In traditional policies, 10% return is virtually impossible. You would readily understand, why they use it then.

5) Insurance on the child

There are products for the benefit of the child, where the child is the insured. It’s absurd, as the child is a dependant and insurance on the child is of no practical use. Yet, these kind of products are sold and are bought by emotionally charged parents, ending up with a bloomer.

Sudhir clutched his head when he came to know of these. He just bought a child insurance on his daughter and he remembers buying a Jeevan Aradhana or some such product, which is one of those ‘intelligently’ packaged ones.

For those buying financial products, a basic level of financial literacy would help. Studying and doing some basic research, is a good idea too. If one is not sure, get an unbiased opinion from someone who knows aboutinsurance. Else, it becomes a costly mistake, which lingers around for years.

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