Page 190 - IC38 GENERAL INSURANCE

Third party administrators were introduced in the year 2001. They are licensed
and regulated by IRDAI and mandated to provide health services. The minimum
capital and other stipulations to qualify as a TPA are prescribed by IRDAI.

Thus health claims servicing are now outsourced by the insurers to the TPAs, at
a remuneration of five-six percent of the premium collected.

Third party administrators enter into an MOU with hospitals or health service
providers and ensure that any person who undergoes treatment in the network
hospitals is given a cashless service. They are the intermediaries between the
insurer(s) and the insured(s), who co-ordinate with the hospitals and finalize
health claims.

5. Hospital

A hospital means any institution established for in-patient care and day care
treatment of sickness and / or injuries and which has been registered as a
hospital with the local authorities, wherever applicable, and is under the
supervision of a registered and qualified medical practitioner AND must comply
with all minimum criteria as under:

a) has at least 10 inpatient beds in those towns having a population of less
than 10,00,000 and 15 inpatient beds in all other places;

b) has qualified nursing staff under its employment round the clock;
c) has qualified medical practitioner(s) in charge round the clock;
d) has a fully equipped operation theatre of its own where surgical

procedures are carried out;
e) maintains daily records of patients and will make these accessible to the

Insurance company‟s authorized personnel.

6. Medical practitioner

A Medical practitioner is a person who holds a valid registration from the
medical council of any state of India and is thereby entitled to practice
medicine within its jurisdiction; and is acting within the scope and jurisdiction
of his license. However, insurance companies are free to make a restriction that
the registered practitioner should not be the insured or any close family
member.

7. Qualified nurse

Qualified nurse means a person who holds a valid registration from the Nursing
Council of India or the Nursing Council of any state in India.

8. Reasonable and necessary expenses

A health insurance policy always contains this clause as the policy provides for
compensation of expenses that would be deemed to be reasonable for
treatment of a particular ailment and in a particular geographical area.

184