Agent protects family figures. Life Insurance policy on a desk.
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India is weighing wide-ranging
reforms of health insurance, from benchmarked treatment rates to
a nationwide claims exchange, as it looks to boost transparency
in a struggle to hold down some of the highest medical inflation
in Asia, two sources said.
Medical inflation of roughly 12 per cent to 14 per cent a year, according to
industry estimates, puts pressure on families and prompts
authorities to hunt ways to standardise pricing and coverage,
said the sources, who are directly familiar with the matter.
Reform recommendations are expected by year-end from a panel
of regulators, industry leaders, hospitals and the
Confederation of Indian Industry (CII) group, with
implementation to be rolled ut later, added the sources, who
sought anonymity as the discussions are private.
"The idea is to benchmark treatment rates, agreed between
insurers and hospitals, to reduce disputes and fraudulent
claims," said one of the sources.
Industry estimates suggest 10 per cent to 15 per cent of health claims are
unwarranted or fraudulent, one of the sources said.
The chief of the Insurance Regulatory and Development
Authority of India (IRDAI) chairs the panel, the sources said.
The regulator IRDAI did not respond to requests for comment.
A CII spokesperson declined to comment.
India wants more of its population of 1.4 billion to invest
in health insurance, where such spending stands at less than 4 per cent
of GDP, as compared to a global average in excess of 7 per cent.
It has lifted curbs on foreign investment and reformed
distribution of its $130-billion insurance industry in the
effort to do so.
More than 40 insurers, including joint ventures of global
groups such as Lombard, ERGO and AIG, operate in India's health
insurance market, generating premiums of about 1.17 trillion
rupees ($12.3 billion) in the fiscal year ended March 2025.
Just this week, lawmakers urged government action to make
private healthcare more affordable, as rising costs for
consumers prompt authorities to focus on health insurance.
Standardised tariffs and billing transparency are seen as
the biggest levers to slow the rampant growth of costs over
time, said one of the sources.
The reforms envisage a common health insurance product that
all insurers will be required to offer alongside existing plans,
aiming to standardise coverage and rates for a range of
illnesses and procedures, the sources said.
It could also include a uniform list of admissible
treatments that makes coverage provisions easier for
policyholders to understand.
Source: Read the original article on www.thehindubusinessline.com