Agent protects family figures. Life Insurance policy on a desk.
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\n\t\t\t\t\t\t\t\t\t\t\tiStockphoto<\/p>\n
India is weighing wide-ranging
\nreforms of health insurance, from benchmarked treatment rates to
\na nationwide \u200cclaims exchange, as it looks to boost transparency
\nin a struggle to hold \u200bdown some of the highest medical inflation
\nin Asia, two sources said.<\/p>\n
Medical \u2060inflation of roughly 12 per cent to 14 per cent a year, according to
\nindustry estimates, puts pressure on families and prompts
\nauthorities to hunt ways to standardise pricing and coverage,
\nsaid the sources, who are directly familiar \u200cwith the matter.<\/p>\n
Reform recommendations are expected by year-end from a panel
\nof regulators, industry leaders, hospitals and the
\nConfederation of Indian Industry (CII) group, with
\nimplementation to be \u200crolled ut later, added the sources, who
\nsought anonymity as the discussions are private.<\/p>\n
"The \u200cidea \u2060is to benchmark treatment rates, agreed between
\ninsurers and hospitals, to reduce \u2060disputes and fraudulent
\nclaims," said one of the sources.<\/p>\n
Industry estimates suggest 10 per cent to 15 per cent of health claims are
\nunwarranted or fraudulent, one of the sources said.<\/p>\n
The chief of the Insurance Regulatory and Development
\nAuthority of India (IRDAI) chairs the \u200bpanel, the sources said.<\/p>\n
The regulator IRDAI \u200cdid not respond to requests for comment.
\nA CII spokesperson declined to comment.<\/p>\n
India wants more of its population of 1.4 billion to invest
\nin health insurance, where such spending stands at less than 4 per cent
\nof GDP, as compared \u200cto a global average in excess of 7 per cent.<\/p>\n
It has lifted curbs on \u200bforeign investment and reformed
\ndistribution of its $130-billion insurance industry in the
\neffort to do so.<\/p>\n
More than 40 insurers, including joint ventures of global
\ngroups such as \u2060Lombard, ERGO and AIG, operate in India's health
\ninsurance market, generating premiums of about 1.17 trillion
\nrupees ($12.3 billion) in the fiscal year ended March 2025.<\/p>\n
Just this week, lawmakers urged government action \u200cto make
\nprivate healthcare more affordable, as rising costs for
\nconsumers prompt authorities to focus on health insurance.<\/p>\n
Standardised tariffs and billing transparency are seen as
\nthe biggest levers to slow the rampant growth of costs over
\ntime, said one of the sources.<\/p>\n
The reforms envisage a common health insurance product that
\nall insurers will be required to offer alongside existing plans,
\naiming to standardise coverage and rates for a range of
\nillnesses and procedures, the sources said.<\/p>\n
It could also include a uniform list of admissible
\ntreatments that makes coverage provisions easier \u200bfor
\npolicyholders to understand.<\/p>\n