A welcome move

Posted on October 5, 2010 | View 966 | Comment : 19

Health insurance portability.

The insurance regulator's proposal to allow consumers to migrate from one health insurer to another is welcome.

Portability of health covers will give consumers more choice, increase competition, lower tariffs and improve service standards. Of course, portability makes sense only if the list of diseases that are eligible for cover remain unchanged.

If a health policy covers pre-existing ailments only after four years and a consumer decides to shift to another insurer in the fourth year, she should not have to wait for four more years for pre-existing diseases to be covered.

Further, policyholders should also carry forward bonuses that have accrued for claim-free years. Migration will work well when a consumer does not lose existing benefits. This is only logical.

Today, insurers sell many health insurance plans, unlike in the past when only a standard medicliam was sold to policyholders.

Consumers will be keen on swapping plans to get comparable, yet better products, at affordable premiums. However, portability in health plans is a concern for insurers underwriting the business.

A consumer who switches from one health service provider to another also brings in liabilities such as history of chronic ailments or frequent claim experience.

Insurers can be selective in accepting customers who want to migrate to curb underwriting losses. They could deny migration benefits to the elderly or those with a history of chronic ailments.

The Insurance Regulatory Development Authority (Irda) should have safeguards to prevent such practices. Building a database on claim history is also a must.

Issues such as data migration and interpretation of existing policy wordings have to be addressed before portability in health insurance is implemented.
Innovative models are also needed to tackle rising health costs. A health savings account, where a policy holder accumulates premium payments, makes sense.

Insurers can operate and manage these accounts. In tandem, the healthcare sector should lower the costs of medical care and make quality healthcare affordable and accessible, leveraging India’s huge volumes.

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Comments (19)

  • However we have to ensure that the transferror should not encourage the frequent claimer only to shift from them , it should be uniform and that both the transferor and transferee Co should get all the all the details . I also feel that the insurered not take advantage of such shifting and that at any time the transferee co should not be at disadvantage of suppression of facts while transferring (about claims) and climfree discount

    Posted by P.A.KUMAR , CEO at MIB | 13 Nov, 2010

  • It is a good one.What is needed is the health treatments given to be posted in the website,which should be accessible by every insurer,This will save all frauds/concelement. This is similar to driver history availabe
    in foreign country and motor premium quoted.

    Posted by Balasubramanyam | 13 Nov, 2010

  • @ Posted by N L VENKATRAO , Manager - Strategic Alliances at National Insurance | 12 Nov, 2010

    "This move will have some disadvantage to the insurers as there is a possibility of frequent claimants shifting from one insurer to another to get undue advantage by concealing the facts of past diseases"
    ...See More

    Posted by Uday Bhasker,EDI Systems Analyst at iSpace Global Solutions Pvt Ltd|12 Nov, 2010

  • It is a good move in favour of the customer and recognises - Customer is the King. This move will have some disadvantage to the insurers as there is a possibility of frequent claimants shifting from one insurer to another to get undue advantage by concealing the facts of past diseases. Health insurance can not be treated like other insurance policies. If there are no claims for many years it does not mean that it is a good risk and the insured can not be given any discounts in premium as the probability of falling sick is more in such case. While allowing portability, sufficient prmemium loading should be done for portability in that case. Needless to mention that the covers should be identical with all the insurers to have a better portability.

    Posted by N L VENKATRAO , Manager - Strategic Alliances at National Insurance | 12 Nov, 2010

  • For portability the policy terms&conditions should be same-like motor policy. The shift arises when 1)service very poor by wilful delays 2)premium very high 3)when the person shifts his residence to another state or area for
    convenience of visit to insurance co( old generation). 4)If the person wants to shift, his entire back records be
    given to them 5)Alternatively persons who ever have claimed and claim rejected, that should be posted in common
    insurance portal for better information. 6)Like motor there should be a std premium with defined reimbursements/
    cashless facility. 7)people want more facilities it should be "Add on cover" by addl. prem. payment.

    Posted by Balasarma | 08 Oct, 2010

  • Yes, it'll be an excellent thing from IRDA, if it is implemented in right spirit. It will definitely the harassement from the side of insurance company. One point is noteable that switching should be associated as a continue insurance & the policyholder should get all the benefits available second year after as usual offering by the company. Policyholder must get swichting power in his hand. IRDA must make a proper framework to avoid any harassment on policyholder.

    Posted by Manoj Singh Chauhan , Director at Orange Financial Services Pvt. Ltd. | 07 Oct, 2010

  • Health Insurance portability will give the policy holder the comfort of better service and the insurer a fair claim experience provided the terms and conditions of the policies across the companies are standarised with the carry forward benefit of the accumulated bonus with no more exclusions of the list of diseases.

    Posted by R.Muralidhar | 06 Oct, 2010

  • @ Posted by Manish Sharma | 05 Oct, 2010

    fyi.....this is not at all related to HIPAA. HIPAA in US mandates insurers to maintain electronic claims in a certain pre-defined format thereby eliminating filing of paper claims.
    HIPAA should not be confused with insurance plan portability.

    Posted by Uday Bhasker,EDI Systems Analyst at iSpace Global Solutions Pvt Ltd|06 Oct, 2010

  • portability for shifting mediclaim is not adviseable as pre existing diseases are not covered with other insurance companies moreover if policy holder has crossed his age of 45 so he/she has to go via medical checkup so insurace company should not ask for medical checkup if policy is in continuation so a policyholder has more flexibility

    Posted by pradeep kumar singla | 05 Oct, 2010

  • Health Insurance Portability and accountabilty act (HIPAA) is a welcome move. It will not only provide better products for a consumer to choose from but also create competetion in the market. IRDA can also look at continuation of group health plan in case employee losses the health benefits with current employer. Employee can pay the 100% premium which was supposed to be paid by organisation. He can continue the benefits till the time he finds a new employer or 6 months whichever is earlier.

    Posted by Manish Sharma | 05 Oct, 2010

  • Migration cab be successful only when terms & conditions of individual mediclaim policies of different insurers are identical. It is suggested that our first step should be on Standardisation of Individual Mediclaim Policies, the terms & conditions applicable, mandatory provision of Cumulative Bonus ( for claim free year) etc. Pre-insurance health check should be made compulsory to avoid rejection of claims by insurers on account of pre-existing disease.

    Posted by Surendar Kumar Malhotra , Chief Operating Officer at Vipul MedCorp TPA Pvt Limited | 05 Oct, 2010

  • The most imp. part is that client will not be compelled to remain in company where he/she is not satisfied.even he/she will be aware about the diff. in premium part of various companies .helpful if guidelines are binding to all ins. cos. equally.

    Posted by bhawna vyas , AM(D) at N.I,A.CO.LTD. | 05 Oct, 2010

  • Welcome developments & idea of health savings a/c is good.

    Posted by Krishna Burli,Insurance Data Execution Assistance at IDEA Cellular Ltd|05 Oct, 2010

  • consumers will get best services round the clock and on the same time insurance company will improved services as per client expectation.

    Posted by deepak khurana | 05 Oct, 2010

  • Bright idea.....fortunately.....umm...actually hopefully, this will pave way for electronic health records which will eventually lead to claim history database which will enable tandem operations!

    But currently, almost all health plans have same or similar plan structure which will discourage portability due to limited options of selecting from plans that actually have different types of coverages for a specific disease. unless plans are restructured, I see no point in portability.
    ...See More

    Posted by Uday Bhasker,EDI Systems Analyst at iSpace Global Solutions Pvt Ltd|05 Oct, 2010

  • Portability in mediclaim is welcomed but it is like two sides of a coin. It can be very much beneficial to the customers but at the same time, the insurer will suffer monetarily to great extent. Many people may take undue advantage too. However if the insurers can have stringent accountabily, transparent transactions, very good and amicable tie ups with hospitals with no malpractices, then the system can be very much benefiting the insured and the insurer as well.

    Posted by satish juthani | 05 Oct, 2010

  • definetly , due to this consumer can change his uncomfortable company. consumer can take more benefit in this competetive edge.

    Posted by sudhir kumar | 05 Oct, 2010

  • good move. consumers can choose and have better service provider with wide coverage

    Posted by vipin | 05 Oct, 2010

  • 1. Proper scrutiny of proposal(health condtions of proposer with specific in depth study)
    2. Frequent interaction with TPA- make them aware of their very lavish, liberal treatment with hospitals, periodical inspection by Ins cos, without givng full fredom to negotiate
    3. Peroidical black listing of Hospitals
    ...See More

    Posted by P. A KUMAR , CEO at MIB | 05 Oct, 2010

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