Our 20-year-old son needed to fix his knee when he got injured while playing a football match for his university team. An MRI revealed his ACL (anterior cruciate ligament) had a grade III tear. According to the medical experts’ opinion, if he wanted to continue to play football, he would need to get it reconstructed. So, after in-depth research and meeting a few doctors in different hospitals about the options options available to get our son’s knee fixed, we finally zeroed in on a doctor and a hospital to carry out the ACL reconstruction surgery.
We applied for pre-approval from our third party administrator (TPA) as is the norm for availing the cashless facility for medical insurance. The expense estimated by the hospital was well within our insurance limits and we thought it was just a matter of procedure and would get the approval easily.
I was totally taken aback when I was told that the insurance company would only cover the package amount agreed upon by the GIPSA (General Insurance Public Sector Association) and the hospital came under the GIPSA preferred provider network (PPN). This information was given to us during the processing of our pre-approval request for cashless facility by our TPA / hospital. We were basically being asked what next did we propose to do?
Package rates
This was the very first time that we had ever heard of the GIPSA; no one, including our insurance company or agent, had ever bothered to inform us about it. The GIPSA is a group of four public sector general insurance companies which as a group have negotiated special package rates with hospitals for many regular, common procedures, surgeries and treatment on the premise that hospitals were overcharging whenever a patient went in for the cashless facility for medical services.
The reasoning is that overcharging by hospitals can lead to the sums insured getting exhausted for simple procedures leaving less protection for the insured person for the rest of a financial year. This is a perfectly sound argument and surely needs addressing, but in a manner that does not boomerang on the patients as it does now. The other more pressing motive behind the GIPSA regime appears to be the fact that all these companies were running huge losses for various reasons (as per a Comptroller and Auditor-General report) and they needed to stem the fund outflow.
In a bid to curb the increasing losses apparently due to fraudulent and inflated claims, the GIPSA had decided to restrict the cashless medical facility only to hospitals that agreed to join the preferred provider network and be part of the GIPSA package arrangement. The rule was implemented on July 1, 2010. That ended hassle-free cashless facility for crores of customers of these insurers and the worst hit was the retail customer.
Cutting corners
More often than not, it has come to light that the PPN hospitals try to cut corners or try to manipulate the situation by inserting things in the bill that are not covered by the GIPSA arrangement. To work around the situation, they make a patient fill up a PPN network declaration form at the time of admission in the hospital. Many a time, the patient signs an undertaking in this form saying that they will pay the difference between the GIPSA package and the actual bill raised by the hospital.
Often, very senior and sought-after doctors who work for the PPN hospital and command high fees are not interested in doing such surgeries as it eats into their well-deserved fees. Some PPN hospitals have panels of doctors specifically to do GIPSA procedures, meaning that the services of the most senior and experienced doctors are not available to people who come under these insurance policies. Many of these people, if their insurers did not have a PPN network and GIPSA package, could have afforded the best doctors as per the terms and conditions of their policies.
To my horror, I discovered that in my State, Himachal Pradesh, there is only one PPN hospital for my insurer. This meant that people living in certain parts of the country, like my State, have been virtually denied the cashless facility, which is most important during a health crisis, and also the most important attribute of medical insurance. This is against the letter and spirit of the basic medical insurance agreement that these companies have with customers like us.
Why should the patient have to look for a PPN hospital during a medical emergency? Why shouldn’t all the tertiary care hospitals/ healthcare establishments automatically be considered a part of the PPN network, especially when there are no PPN hospitals in some places?
Overcharging by healthcare service providers/ hospitals cannot be dealt with by bullying them to agree to a price package, which is not entirely acceptable to them. What stops other private players in the insurance market to come together and ask for a GIPSA-like package that they may deem just and reasonable?
Are we not dooming the health insurance customers to mediocrity? Instead of guarding the interests of the patients, which is the rationale behind the GIPSA arrangement, the insured are being done a disservice by creating an environment where the hospitals do not see any reason why they should continually upgrade their infrastructure and expertise when they have to adhere to unreasonable price packages because of market compulsions.
Are we not creating a situation where hospitals are not making the services of their top doctors available to GIPSA cases? It cannot be denied that a lot of healthcare service providers and private hospitals have been overcharging patients and that issue needs to be addressed. We surely need a system to ensure the pricing of healthcare services are just, fair and reasonable. But instead of stifling the pricing of the healthcare services using medical insurance companies’ bargaining power, it is better that we use a collaborative method to collectively arrive at a solution.
The IRDAI (Insurance Regulatory and Development Authority of India) needs to take urgent notice of this situation.
archana.nrmenvlaw@gmail.com
