Page 48 - Insurance Times March 2017 Sample

PPN System - Failure or Success : Continued from Page 28

responsible to monitor this because they are getting the hospital/NH to arrive at a conclusion. If it is established that
hospital bills in each and every case. the charges are genuinely levied for some medical exigen-
cies then the insured is entitled for reimbursement of the
Insured cannot be deprived and discriminated merely because same in terms of the principle of indemnity. The policy pro-
hospitals have agreed PPN Rates and in practice charge vides for reimbursement of reasonable and necessary medi-
higher amount by obtaining consent on Annexure "C". cal expenses covered under the policy. In such a situation
the rejection of claim for extra charges on the ground that
PPN system in the context of Principle it exceeds the agreed package rate does not hold good.
of Indemnity On the other hand if such extra charges are not based on
The preamble clause of any health insurance policy states valid medical exigencies it only establishes that the con-
that "the Company will pay through TPA the amount of such cerned hospital/NH has violated the PPN agreement. In such
expenses as are reasonably and necessarily incurred". In a situation denial of claim for reimbursement to the insured
view of this it is the moral and legal responsibility of the on the grounds of violation of PPN agreement and allowing
insurer, and on his behalf of the TPA, that insured is fully the Hospital/NH to get away scot free is gross injustice to
indemnified. The insurers and health provider hospitals may the insured as also the breach of the agreement between
enter into any agreements in the context of cashless sup- two parties. Consider this aspect that for the same total
port benefit but by doing so they cannot deprive the insured charges in the bill in NON PPN hospital/NH TPA would have
of his legitimate right to have complete indemnity under the settled the claim for full amount considering the billed
policy. amount as standard charges of the hospital/NH.

When the policy holder applies for cashless in the case of Since the violation is done by hospital/NH, one of the par-
specified procedures in PPN hospital/NH the TPA approves ties to the agreement, it is the moral and legal responsibil-
cashless amount as per agreed package rate. However, in- ity of the other party to either get refund of the same from
variably the hospitals/NH are charging much more than the hospital/NH to the insured or reimburse the same from in-
agreed package rates and when the claim is presented for surers account to the insured and realize the same from the
reimbursement for such extra charges it is repudiated "on hospital legally.
the grounds that this excess amount incurred during the
hospitalization period is in violation of PPN term and condi- If the insured has to bear the extra charges in excess of the
agreed package rate in either case he will be deprived of
tions". Now in this situation the question arises that is the
the complete indemnity under the policy and it tantamount
rejection of claim for such extra charges is in consonance
with the principle of indemnity? In any policy of insurance to violation of Principle of Indemnity on the part of insurer.
the claim amount is determined on the basis of principle of Conclusion
indemnity in relation to the terms, conditions and provision
of the policy. We all are aware that the health services rendered in India
by Hospitals/NH in private sector is running on commercial
For example under Fire policy indemnity for depreciation is basis as such a legitimate motive of making profit will al-
not payable if the settlement is done on market value basis ways be there. Such establishments mainly agree for pro-
but the same is payable when settlement is done on rein- viding health services against Cashless guarantee for the
statement basis. Therefore, the criteria for admissibility of reason that the cashless system increases their volume of
claim for any extra charges beyond agreed package rate business.
should be examined in the context of the principle of indem-
nity under the health insurance policy. The TPA and their But when after entering into an agreement of providing
team of doctors have to judge why extra charges have been services at agreed package rates and charging extra amount
levied by the hospital. without any valid medical reason they are violating the
agreement. In the absence of any checks and balances in
From the available papers they can analyse and determine the system monitored by TPA they get scot free and as a
whether the charges are on valid medical ground or not? If result of this insured the one who is deprived of the com-
require they can obtain further clarification from concerned plete indemnity.

48 The Insurance Times, March 2017

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