After Jaslok Hospital, other hospitals are lining up to join the preferred provider network in a major breakthrough for insurers that will bring relief to mediclaim policyholders
To the relief of the consumers, more and more hospitals are joining the Preferred Provider Network (PPN). Jaslok of Mumbai has just joined and Fortis is likely to sign up soon. A couple of other big institutions are also in negotiations with the General Insurance Public Sector Association (GIPSA).
Colonel Manesh Masand, chief executive officer of Jaslok Hospital, which is the first premier institute in south Mumbai to join the PPN, told Moneylife, "We have mutually agreed to the rates for 43 packages. The removal of the cashless feature did not impact our business, but we are joining PPN to help patients. PPN rates to the cashless mediclaim policyholders will be effective from 15th January. If anything exceeds the package, we will give proper justification for it. Either the insurance company or patient will have to bear the same."
Policyholders with public sector (PSU) insurance companies will certainly benefit with the resumption of the cashless facility at Jaslok Hospital. It also raises hopes for PSU insurers to cajole other hospitals to join PPN.
According to M Ramadoss, chairman and managing director, New India Assurance Co Ltd, "Rates could vary from hospital to hospital, based on location, facilities, and equipment. It's not a one-size-fits-all solution. If there is an industry standard for standard rates, we will welcome it. Due to the absence of it, I have to step in, but not to rob hospitals of their profits. We have benchmarked average costs of the previous two-three years and have used recommendations of doctors on panels for frozen standard rates for procedures and treatments."
In a bid to curb the increasing losses incurred by hospitals due to fraudulent and inflated claims, General Insurance Public Sector Association (GIPSA), a group of four public-sector insurance companies had decided to restrict the cashless medical facility only to hospitals that agree to join the PPN. The rule, which was implemented on 1 July 2010, offers a negotiated rate for 43 treatments that are covered under the cashless policy. The four insurance companies are New India Assurance Company Ltd, United India Insurance Company Ltd, Oriental Insurance Company Ltd and National Insurance Company Ltd.
According to a third party administrator (TPA), "Every hospital is eager for business and Jaslok will surely benefit by joining PPN. Many hospitals have stagnant growth even when they add new patients. PSU insurers will benefit by getting discounts for bulk business."
Deepak Mendiratta, a health benefits expert, said, "Packages are possible in surgical ailments (hernia, knee replacement, bypass, and so on) but not for medical management. These are high-cost surgeries. Given the option to pay from pocket (for later reimbursement) or getting cashless (benefit), the obvious choice is cashless, unless there is high doctor loyalty. There is always uncertainty of not getting reimbursement from insurers due to various reasons."
"The hospitals are making a business decision to join PPN or not (to join) based on the level of shift in customers due to absence of PPN. Medanta (in Delhi, and has joined PPN) is a newer hospital that will eventually be a 1,300 bed facility and needs customers," Mr Mendiratta said. "Sir Ganga Ram (also in Delhi) recently had seven top doctors leaving them and it was enough of a reason to join PPN. The rates these hospitals accept to join PPN also serves as a benchmark for other hospitals as well as for insurers to help them bring more hospitals onboard. It ultimately helps to reduce rates for surgeries and hence controlling the claims ratio."
The packages are designed within the given parameters and defined limits. The agreement of package rates after negotiation with GIPSA can give hospitals what they expect, if the expectation is reasonable. The tightly-defined packages, clearly explaining what they include and exclude, also helps insurers to know that there will not be inflated, fraudulent or unwarranted claims. As long as there are no major exclusions, policyholders will not have to pay from their own pocket in case insurers don't cover it.
GIPSA expects 70% of hospitals in Mumbai to join its PPN for the cashless mediclaim scheme in the coming months. After Jaslok, many other major hospitals are likely to join the PPN as they do not want to lose business to Jaslok. Kokilaben Dhirubhai Ambani Hospital, Bombay Hospital and the Fortis group are in the process of negotiations.
But Fortis group Ranjana Smetacek, director of marketing and corporate communications said, "As of now, the Fortis Group is not joining the PPN. The association of hospitals and nursing homes in Mumbai has made a decision not to join the PPN and our hospitals in Mumbai are abiding with this decision."
There are 169 hospitals in Mumbai on the cashless mediclaim network. Among them are such big names as Jupiter Hospital in Thane, MGM Vashi, Sterling Wockhardt in Vashi, Kohinoor Hospital in Kurla, SevenHills in Andheri (East), S R Mehta Cardiac Hospital at King's Circle, Joy Hospital in Chembur, and Surana hospitals in Malad as well as Chembur.
Aidem Ventures has appointed M Suku as the executive vice president, reflecting the company’s expansion into new emerging media, markets and verticals.
M Suku is an industry veteran with over 25 years of experience in business development, contract negotiation and strategic planning, buying and media assessment. He has worked with companies like Lintas, Colgate, JWT, Ogilvy, Unilever (Secondment) ABCL, Eenadu & Group M.
At Group M, as national director, he set up Broadmind (Now GroupM ESP) from scratch into a significant contribution of entrepreneurs, revenues, profits and awards. The Broadmind Indian business model was regionally and globally recognised and adopted. He moved to GroupM
“We are extremely excited about Suku’s appointment. At Aidem he will be a part of the core management team. His extensive knowledge and experience in the industry will strengthen Aidem’s business expansion strategy,” said Raj Nayak, managing director. This appointment continues Aidem’s drive to provide its clients with experienced industry personal to support their projects.
Prior to this appointment M Suku was with The Reliance ADA Group, one of India’s largest advertisers where he was the head of media and alliances.
The local market is expected to have a positive opening today on the back of supportive global cues. Wall Street closed with modest gains on Monday on strong economic data. Markets in Asia were mostly higher in early trade on Tuesday on improved outlook of the world economy. The SGX Nifty was up 20.50 points at 6,201.50 compared to its previous close of 6,181.
Yesterday, the market opened with smart gains on support from its Asian peers. It touched the day's high within minutes of the opening bell on institutional buying. However, the indices pared some gains on profit-taking at higher levels. The market moved further southwards in the post-noon session but stayed in the green and closed off the day's lows. On the other hand, the broader indices closed with decent gains.
The Sensex closed at 20,561.05, a gain of 51.96 points (0.25%). The Nifty ended the year's first trading day 23.10 points (0.38%) higher at 6,157.60.
Markets in the US closed firm on Monday, the first trading day of 2011, on positive economic indicators, signalling that the economic recovery is on track. Manufacturing activity expanded in December at the fastest pace in seven months. The Institute for Supply Management’s index climbed to 57 last month from 56.6 in November, the Tempe, Arizona-based group said yesterday. Former Federal Reserve Governor Frederic Mishkin said that while the central bank will complete its $600 billion bond- purchase program to help fuel the economy, a third round of the so-called quantitative easing is unlikely. Another report showed construction spending rose in November for a third month, helped in part by government projects. A 0.4% gain followed a 0.7% increase in October.
The Dow surged 93.24 points (0.81%) to 11,670.75. The S&P 500 gained 14.23 points (1.13%) to 1,271.87. The Nasdaq rose 38.65 points (1.46%) to close at 2,691.52.
Markets in Asia were mostly in the green in early trade this morning on optimism over the global recovery boosted demand for riskier assets like stocks.
The Shanghai Composite was up 0.61%, the Hang Seng added 0.02%, the Jakarta Composite was up 0.29%, the KLSE Composite climbed 0.73%, the Nikkei 225 surged 1.42%, the Straits Times gained 0.51% and the Seoul Composite was up 0.31%. On the other hand, the Taiwan Weighed lost 0.03% in early trade. The SGX Nifty was up 20.50 points at 6,201.50 compared to its previous close of 6,181.
In other news back home, the government yesterday said it will come out with two more series on monthly consumer price inflation from the next month to reflect the impact of price rise on consumption pattern of households in urban and rural areas.
“CSO will be releasing CPI—urban and rural—indices for January onwards. The first data would be released sometime in February,” chief statistician TCA Anant stated.
Currently, there are four CPI inflation series—CPI for industrial workers, CPI for agricultural labourers, CPI for rural labourers and CPI for urban non-manual employees. Besides four CPI series, wholesale prices are measured by WPI index.