United India Insurance denied cashless feature for few months after policy renewal citing data was not updated by the TPA. In the age of technology, this seems to be an insurer and/or TPA strategy rather than inefficiency

In a landmark judgement the Central Information Commission (CIC) directed United India Insurance Company (UIIC) to mandate all branch managers to put up on the company’s website information on date of issue of each mediclaim policy and date of transfer of the policy related information to the TPA (Third Party Administrator). It will surely enhance the transparency for all future policy purchases or renewals. This information is not mandated to be given for past policies and hence it is unlikely UIIC will comply for historical data. The CIC decision comes after one year of RTI (Right to Information) activism by Moneylife subscriber Dr Anshu Agrawal from Janakpuri, Bareilly, who finally got justice in the second appeal before the Commission on 28 June 2012.
 

This will surely put insurers and TPAs on the back-foot as this hide-and-seek game between insurers and TPAs has been the root cause of senseless denial of legitimate cashless feature for almost two-three months after each customer policy renewal. According to Dr Agrawal, “This ruling will soon be applicable to other insurers who operate through TPAs”. Dr Agrawal had filed an RTI application with the Insurance Regulatory and Development Authority (IRDA) to find if there were any guidelines on the time limit for the insurer to dispatch the policy copy to the TPA. According to RTI reply, “IRDA has not mandated any time limit.”
 

A delay of two to three months to give renewal information to the TPA and/or TPAs not updating their systems with renewal information leads to denial of cashless approval under an inexplicable excuse that the customer has not renewed the policy even though the insurer has encashed the payment cheque two to three months back. This is nothing short of cheating. What’s more disturbing is that this can even impact reimbursement claim.
 

According to another Moneylife reader, “United India has instructed its offices to send soft data, to the TPAs, of health insurance renewals once a month only, usually on the last day of the month. As a result when an insured is admitted to a hospital a week or two after his policy has been renewed and he contacts the TPA, he is told that as per their records his policy has not been renewed and therefore they are unable to register his claim even though he had called them within the mandatory 24-hour deadline! As a result he is also denied cashless facility and has to go in for reimbursement which again will be denied on the grounds that the claim was not reported within 24 hours!”
 

Dr Anshu Agrawal, says, “I tried to find out the working of a branch office of UIIC. If you buy one health policy on say 1^st June, they receive bank statement only by 15^th July. They take another 15 days for reconciliation of bank statement manually. Another one month is taken to download form 64VB from their website to fill it, copy it and despatch to the TPA. In the era of net-banking and e-mail communicability, UIIC is living in medieval era.”
 

Dr Agrawal got a cashless ID card from his TPA almost one year after buying mediclaim and that too after long persuasion with UIIC regional customer care department and couple of complaints on their website. The subsequent renewals despatch by UIIC was consistently after couple of months of expiry date of previous mediclaim. He was worried about claims denial in case there was medical need within the two-three months of policy renewal.
 

One year ago, Dr Agrawal sought information under RTI about mediclaim issue dates and policy despatch dates by the Bareilly branch office, how many days does it take for a health policy to be dispatched to TPA and whether cashless or reimbursement claim will be honoured if the TPA does not have policy renewal details. The answers to these questions may just startle you.
 

Read the second part of the article tomorrow to understand how UIIC CPIO still continues to evade giving information even after the CIC took the liberty of looking at the issue in larger public interest of all insurance policyholders to issue the landmark judgement.