Page 12 - Insurance Times April 2019

No cap on insurer's profit in Chhattisgarh
Ayushman Bharat will
In Ayushman Bharat scheme, in order to avoid windfall gains for insurance
not cover cataract opera- companies, a model tender document specifies the
tions, dialysis and normal maximum gain an insurer can make if there is a sur-
plus after claims settlement. But Chhattisgarh has
deliveries not included the pertinent clause while implement-
ing the scheme in the State. This implies that if
there is a surplus after settling all claims it can be
kept by the insurer. In Chhattisgarh, which has adopted the hybrid model,
Religare Health is the insurance partner.
According to the 'Model Tender Document for Selection of Insurance Company',
clause 12.2 deals with the refund of premium by the insurer (in case claims are
less than the premium), and additional premium by the State Health Agency
National Health Authority (NHA) is (SHA) (in case claims are more than the premium). In case of surplus, if claims
planning to remove procedures cov- ratio (ratio of claims incurred to net earned premium) is less than 60 per cent,
ered under existing national then the insurer can keep only 12 per cent of premium as profit when it comes
programmes from the list of pack- to category A States (10 per cent for category B States).
ages approved for reimbursement If claims ratio is between 60-70 per cent, then the maximum profit an insurer
under PMJAY. This means proce- can keep is 15 per cent (12 per cent in category B States), and if claims ratio is
dures like cataract surgeries; dialysis 70-80 per cent, then the insurer can keep 20 per cent profit (15 per cent in
and normal deliveries will not be category B States, where the claims ratio is 70-85 per cent). In the same clause,
covered by the health scheme.
the burden of excess claims - to be borne by insurer and State - is also men-
Cataract surgeries have topped the tioned. If In Chhattisgarh, the insurer gets to keep the entire profit in a good
list of claims submitted under year, but will have to bear the excess claims burden in a bad year.
PMJAY. In the first three months of Chhattisgarh has adopted the hybrid model to implement Ayushman, where a
PMJAY - until November 24, 2018 - claim package of up to Rs. 50,000 is taken under the insurance model, while a
6,900 claims had been submitted for package of more than Rs. 50,000 is processed under the trust model.
cataract surgeries even though they
are done for free under the National Rise in claims may increase insurance premium under
Blindness Control Programme Ayushman Bharat in Tamilnadu
(NBCP). In 2017-18 alone, 15,91,977
surgeries were performed under Tamil Nadu, which has integrated the Chief Minister's Comprehensive Health
NBCP, which dates back to 1976. Insurance Scheme (CMCHIS) with the Centre's Ayushman
Bharat scheme, has submitted 1.25 lakh claims so far to-
While the NHA is planning to leave taling Rs. 274 crore. United India Insurance, the State's
out normal deliveries from the insurance partner for the earlier CMCHIS, currently
ambit of PMJAY because there are a charges a premium of Rs. 699 per cover, which is borne
host of national programmes for by the State (under Ayushman, it is split between the
mother and child health, high-risk Centre and the State in 60:40 ratio for 77 lakh beneficiaries).
deliveries will continue to be cov- The existing tender comes up for renewal in 2022. The fact that the State's
ered. The Pradhan Mantri National
health scheme has been in operation for over seven years, and claims have more
Dialysis Programme was rolled out in
or less stabilised, lends comfort on the premium front. But integration of
2016 under which dialysis is already Ayushman with CMCHIS is likely to increase awareness and also lead to sub-
provided free of cost.
stantial rise in claims over the next two to three years. This could increase the
The NHA is also in talks with the Na- premium costs significantly when the tender comes up for renewal.
tional Pharmaceutical Pricing Au- Ayushman Bharat Scheme provides a wider coverage compared to CMCHIS.
thority (NPPA) to negotiate special Ayushman covers 1,393 procedures, while CMCHIS covered 1,027 packages.
rates for implants or other devices About 335 packages fall under both schemes, while 635 are covered in one and
that are used under PMJAY to fur- not the other. All three types - totaling 970 - are clubbed and covered under
ther bring down costs. the new integrated health scheme called PMJAY-CMCHIS.

12 The Insurance Times, April 2019