Page 29 - Insurance Times January 2023

4. Excess payments due to non-recovery of Co- the two group health insurance policies. In OICL, Audit
noticed that in 86 out of 378 claims settled in two policies
payment
towards treatment for cataract, the capping limit was not
Co-payment is a cost sharing requirement under a health
applied which resulted in excess settlement of . Rs. 5.04 lakh.
insurance policy which provides that the policyholder/ insured
will bear a specified percentage of the admissible claims
6. Claim settlements under domiciliary
amount. Audit noticed that in NIACL the terms and conditions
hospitalization
of group policy of one major group client (M/s. Cognizant
IRDAI vide its circular regarding guidelines on standardization
Technology Services Limited) contained the 'Co-payment'
of Health Insurance defines domiciliary hospitalization as
clause as per which the amount to be deducted from the
medical treatment for an illness/ injury in the normal course
admissible claim amount was 10 per cent in excess of Rs. 1
which would require care and treatment at a hospital but is
lakh for self or employee and 20 per cent for dependents on
actually taken while confined at home, provided where the
the entire admissible amount. Data analysis revealed that in
condition of the patient is such that he/ she is not in a condition
275 claims co-payment was not deducted and excess
to be moved to a hospital, or the patient takes treatment at
payment of Rs. 84.36 lakh was made. This was confirmed
home on account of non-availability of room in a hospital.
during test check of 5 sample cases out of 275 such claims. In
The said circular defines OPD treatment as the one in which
respect of retail claims, Audit carried out data analysis of
the insured visit a clinic/ hospital or associated facility like a
claims settled in respect of Senior Citizen Mediclaim Policy
consultation room for diagnosis and treatment is taken based
and New India Sixty Plus Mediclaim Policy and also test
on the advice of medical practitioner. The insured is not
checked 700 claims out of 12,621 claims from the website of
admitted as a day care or in-patient. Test check of domiciliary
10 TPAs 28 and claim links provided to Audit. Out of 700 claims,
claims in NIACL revealed that 242 claims 29 out of 1,154
in 117 claims (53 Senior Citizen Mediclaim Policy claims and
claims were for OPD treatment but these were settled by
64 New India Sixty Plus Mediclaim Policy claims) TPAs did not
showing them as domiciliary claims. The claims were of group
deduct the applicable co-payment amount leading to excess
payment of Rs. 7.71 lakh. This indicated that IT system policy issued to M/s TATA Consultancy Services Ltd. (TCS) and
M/s. HPCL Mittal Energy Ltd (HMEL) under which OPD
validation to verify application of co-payment clause was not
treatment was not covered.
prevalent in the TPA's end as well as NIACL's end.
7. Non-adherence to network agreed rates
5. Breach of capping on specific diseases
Regulatory clause 20(1) to (5) of IRDAI (TPA - Health Services)
As per terms and conditions of policy, claim amount for specific
Regulations, 2016 provide for agreements between a TPA,
diseases/ procedures would be capped at rates mentioned in
an insurer and a Network Provider. Accordingly, PSU insurers/
the policy. Data analysis was carried out to verify application
TPA have negotiated and entered into agreements with
of the capping for a common disease viz. cataract, for which
certain network hospitals for various medical/surgical
the capping amount ranging from Rs. 10,000 to Rs. 50,000
procedures at agreed rates. In this regard, Audit observed
was fixed in 13 out of 19 individual products of NIACL. It was
that in respect of 19 claims out of 2,176 claims, there were
found that the capping of claim amount for cataract was not
variation between the rate allowed by the TPAs and agreed
applied in 1,389 retail claims (pertaining to 12 individual
rate. Further, it was observed that certain items which were
products) and there was excess payment of Rs. 2.33 crore
part of the package rate such as doctor's fee, room charges
due to breach of the ceiling amount. This was confirmed
and investigation charges, etc., were charged additionally
during test check of 43 claim records. Data analysis of group
thereby resulting in excess payment. Charging higher rates
health insurance policies of two major group policy clients of
and additional charges resulted in excess settlement of claims
NIACL viz. M/s Tata Consultancy Services Limited and M/s
amounting to Rs. 12.60 lakh.
Cognizant Technology Services Ltd. with specific reference
to capping for certain diseases such as maternity and infertility
8. Incorrect assessment of admissible claim
treatment, cataract expenses, joint replacements,
hysterectomy expenses, cancer benefit, etc., as per the terms amount by TPAs
and conditions of the respective policies was carried out. It TPAs have failed to exercise appropriate checks which were
was found that there was excess settlement of Rs. 1.65 crore required to be carried out while processing the claims and
(729 claims for Rs. 1.24 crore - M/s Tata Consultancy Services assessing the admissible amount, which resulted in excess
Limited and 275 claims for Rs. 40.98 lakh M/s Cognizant settlement in the following cases: i) Excess room rent/boarding
Technology Services Ltd.) by NIACL to the beneficiaries under charges allowed in claim assessment Terms and conditions of
The Insurance Times January 2023 25