Healthcare providers in Mumbai formed a core committee on Friday to deal with the controversial preferred provider network (PPN) programme unilaterally introduced by public sector general insurance companies under the cashless mediclaim facility.
Healthcare providers in Mumbai formed a core committee on Friday to deal with the controversial preferred provider network (PPN) programme unilaterally introduced by public sector general insurance companies under the cashless mediclaim facility.
The core committee consists of four associations - the Association of Medical Consultants (AMC), the Association of Hospitals (AOH), the Bombay Ophthalmology Association (BOA) and the Bombay Nursing Home Association (BNHA). It is headed by Vijay Krishna, the chief executive officer of Breach Candy Hospital.
“The insurance companies should communicate with the committee from now on and not with individual hospitals,” said Manesh Masand, president of the AOH.
The controversy began over a month ago. Four public sector insurance companies — New India Assurance, Oriental Insurance, United India Insurance and National Insurance — felt that certain healthcare providers inflated their bills so that they could avail of high reimbursements under the cashless mediclaim facility. In order to curb this perceived malpractice, the insurance companies introduced the PPN on July 1. Under this, they hand-picked 70 hospitals, which, they felt, did not unfairly inflate their bills. Only these were allowed to claim reimbursements under cashless mediclaim. This marked a sharp decline from the 900 hospitals that were earlier allowed reimbursements. Gradually, they increased the number to 120.
The healthcare providers, on the other hand, felt that the insurance companies did not consult them while launching the PPN programme. The decision to reduce the number of hospitals from 900 to 120 was also unilaterally taken.
Many of the 120 retained by the insurance companies, too, had grouses. The insurance companies fixed a tariff rate card for 42 different standard medical procedures. The insurance companies would reimburse healthcare providers according to these rates, which the latter found to be about 50% less than what they actually charged.
“The rate for a procedure of cataract is about Rs24,000 under the PPN,” said Dr Sujata Rao, president of the AMC. Thus the maximum reimbursement that a hospital can claim for a cataract procedure would be Rs24,000. “This is not acceptable as only the lens used in the procedure costs that much.”
Because of this discrepancy, 75 of the 120 hospitals withdrew from PPN. “However, the insurance companies are not reporting this,” added Rao. According to Dr Nayan Shah of Paramount Health Services, about 25-30% of a hospital’s occupancy consisted of insurance patients, and hence the insurance companies would soon have to design an array of programmes to address their concerns.
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