The Insurance Regulatory and Development Authority of India (IRDAI) has issued a comprehensive master circular on health insurance, bringing significant changes aimed at empowering policyholders and enhancing service standards across the sector.
Key Highlights of the Master Circular
- Quick Cashless Authorization: Insurers are now required to decide on cashless authorization requests within one hour of receiving them. This change expedites the process, ensuring patients receive timely medical care without financial delays.
- Final Authorization for Hospital Discharge: The new rules mandate that insurers grant final authorization within three hours of receiving a discharge request from the hospital. If there is any delay beyond this period, the insurer will bear any additional charges from the hospital using funds from their shareholders.
- Handling of Mortal Remains: In the unfortunate event of a policyholder's death during treatment, the insurer must immediately process the claim and facilitate the release of the mortal remains from the hospital without delay.
- Ombudsman Award Compliance: Insurers are required to comply with the Insurance Ombudsman's awards within 30 days. Failure to do so will result in a penalty of Rs. 5000 per day and any penal interest as per the Insurance Ombudsman Rules, 2017.
- Push for Cashless Claims: The IRDAI aims to minimize instances where claims are settled through reimbursement. Insurers are encouraged to achieve 100% cashless claim settlement and are required to implement necessary systems and procedures by July 31, 2024. Insurers are also advised to set up dedicated help desks at hospitals and provide pre-authorization digitally.
- Improved Claims Settlement Process: No claim can be repudiated without the approval of the Policyholder Management Committee (PMC) or its three-member sub-group, the Claims Review Committee (CRC). Insurers must provide detailed explanations referencing specific policy terms if a claim is denied or partially disallowed.
- Simplified Documentation: Insurers and third-party administrators (TPAs) are responsible for collecting required documents directly from hospitals, relieving policyholders of this administrative burden.
Objective of the Health Insurance Circular
The master circular, dated May 29, consolidates and replaces 55 previous circulars. Its primary goal is to provide policyholders with a clear and concise reference regarding their entitlements. Doing so aims to facilitate a smoother, faster, and more hassle-free claims experience, ultimately promoting trust and transparency in the health insurance sector.
Conclusion
The IRDAI's master circular represents a significant advancement in the health insurance sector, prioritizing policyholders' needs and well-being. By ensuring quicker claim approvals and discharge processes and holding insurers accountable for delays, this initiative will make healthcare more accessible and less stressful for millions of policyholders. As the industry adapts to these changes, patients and healthcare providers are expected to benefit from a more efficient and trustworthy health insurance system.
