Not just big hospitals, but smaller medical consultants and nursing homes are also facing trouble from TPAs. Is it time to cut out the middleman?
Even as top hospitals in the cities have been facing several issues with third-party administrators (TPAs), it now appears that the problem extends to smaller medical consultants and nursing homes in the metros. They are so disheartened by TPAs that they would like to see the end of cashless settlements. A number of them say that TPAs have been playing around with the insurer's money, which has resulted in delayed payments.
TPAs have been receiving money from insurance companies to settle claims; however, insurers have complained that diversion of float funds provided to TPAs is going on. The complaint is that these funds are not being used for settling patients' claims. This has resulted in doctors getting their payments after six to eight months. "They (TPAs) are hand-in-glove with a lot of people and are floating insurer funds," said an official from the Bombay Nursing Homes Association, who preferred anonymity.
"Many medical consultants are of the opinion that they don't want to be a part of these cashless schemes as the present working module is defunct," Rajeev Walwakar, president, Association of Medical Consultants (AMC), told Moneylife.
Medical consultants complain that the current implementation module is not feasible. The payments which doctors have to receive are always delayed. Again, the complete payment is not given. "The working modules have been very disappointing and we haven't received proper payments from TPAs," Mr Walwakar added. This has resulted in many medical practitioners feeling that cashless settlements should be done away with. Also, hospitals and doctors complain that TPAs never answer any queries from doctors on payments.
Medical consultants are also arguing that TPAs have been misinforming their customers. Currently, TPAs have contracts with hospitals, which are added to the preferred provider network (PPN) by insurance companies. "We are not dealing with insurance companies. We are dealing with TPAs, so the issues are with TPAs," added Mr Walwakar.
However, a few insurers whom we spoke to said that TPAs can't be wholly blamed for the current imbroglio, as payments to hospitals depend on the insurance company. These insurers also feel that hospitals were
In March, about 1,500 nursing homes and various doctors under the AMC banner had decided to boycott TPAs completely after they had asked hospitals and doctors to work on lower rates.
At the same time, there were unpaid dues from TPAs. Ergo, patients in hospitals covered by these TPAs could not avail of cashless facilities. However, negotiations were on between TPAs and hospitals. But then came the surprising move by public sector insurance companies to scrap cashless facilities at certain hospitals. Insurers have claimed that certain hospitals were inflating bills exorbitantly, leading to significant losses in their business.
Yesterday, a discussion was conducted by members of the Confederation of Indian Industry's (CII) National Committee on Healthcare. Stakeholders including AMC met four public sector insurance companies (including New India Assurance, Oriental Insurance, United India Insurance and National Insurance Company). Out of the four hospitals that were present, three of them - Fortis Hospitals, Max Healthcare and Apollo Hospitals -have their own health-based insurance companies.
Many insurance companies are trying to manage the cost of claims, putting in place better customer service and opting for in-house TPAs. Private insurance companies like ICICI Lombard and Bajaj Allianz have done away with TPAs. By the end of this year, Future Generali will have its own in-house team to service health policies, instead of making customers deal with TPAs for facilitating medical insurance payouts.
The three retailers will once in a month "coordinate" on pricing of petrol based on international price trend of crude oil (the raw material used to make petrol) and gasoline
State-owned oil companies Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) today decided to have a uniform petrol price despite government giving them freedom to price the fuel and said they will revise prices once a month based on input cost, reports PTI.
The three retailers will once in a month "coordinate" on pricing of petrol based on international price trend of crude oil (the raw material used to make petrol) and gasoline, Indian Oil Corporation director (finance) S V Narasimhan said.
"All the three oil marketing companies will have uniform price," he said.
The decision to allow IOC, BPCL, and HPCL to function as 'informal' cartel was taken at a meeting called by oil secretary S Sundareshan. The meeting was called to decide on the modalities of how petrol will be priced after it was freed from the government control.
"Petrol price on 25th June were raised by Rs3.50 per litre following price decontrol instead of Rs3.73 a litre required to align them with cost," Mr Narasimhan said.
Subsequently, international oil prices declined, wiping away most of losses. "We have reviewed the situation and as of now there is no need for revise petrol prices," he said.
On 25th June, an Empowered Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee had also decided to free diesel prices from government control but raised rates only by Rs2 per litre instead of Rs3.80 per litre required to align them with international cost.
The gap between retail selling price and international cost widened subsequently to Rs3.14 per litre from Rs1.80 a litre at the time of price hike. This has subsequently come down to Rs1.70-Rs1.80 per litre now.
"There is no decision or move to revise prices of diesel at this juncture," Mr Sundareshan said.
Mr Narasimhan said the oil companies do not feel the need for revising rates of petrol now and will review the situation possibly by the month end.
From now only, pump rates will be revised once a month.
The three companies will have a uniform rate for petrol in particular cities or locations, and it would change on the same dates.
"We will not announce dates of revision in advance to avoid hoarding of the fuel. We will revise prices on any day of the month," an official said.
Three PSUs have already held discussions with private retailers - Reliance Industries (RIL), Essar Oil and Royal Dutch/Shell - on modalities such as frequency and intervals at which prices would be revised.
Mr Sundareshan said he hoped the private sector rates would not be very different from PSU fixed prices.
Moneylife had reported on 6th May that Piramal Healthcare may be up for sale. The company was claiming that it was planning to acquire smaller labs for growth. Now it has been sold out to Super Religare Lab
Piramal Healthcare is set to sell off its diagnostics unit to Super Religare Laboratories (SRL). In a deal valued at around Rs600 crore, SRL will acquire controlling stake in Piramal Diagnostic Services Private Limited (PDSL), which provides pathology and radiology diagnostics services.
This development is completely contrary to the Piramal management’s earlier claims about acquiring smaller diagnostics laboratories around the country in the company’s bid for growth. Moneylife had earlier written (see: http://www.moneylife.in/article/8/4344.html) on how the PDSL management’s claim of acquisitions of 10 smaller pathology labs did not ring true.
We followed this up with another article (see: http://www.moneylife.in/article/8/5230.html), which highlighted the fact that the company had already shut down its diagnostics operations in Delhi, even as it was refuting rumours of its complete exit from the diagnostics space. Dr Swati Piramal, director, Piramal Healthcare had informed Moneylife, “We would like to clarify that the news appearing in certain sections of the media about the Piramal Group planning to close its diagnostics operations is completely baseless and untrue. We have expanded rapidly till 2009 and will continue to expand after consolidating and strengthening business processes.”
Moneylife’s stance on the issue now stands vindicated with confirmation that Piramal Healthcare has entered into an agreement for SRL to acquire its diagnostics business. This is in sharp contrast to the company’s earlier claims. It appears that this was part of the management’s carefully crafted strategy to give a wrong impression.
Interestingly, while PDSL was talking of acquisitions, the business was running at large losses for the past three years. The losses it incurred over the past three years are Rs3.54 crore (2007), which increased to Rs4.20 crore and Rs3.71 crore in 2008 and 2009, respectively.
Commenting on the sell-out, Ajay Piramal, chairman, Piramal Group told PTI, “We feel it is the right time to take the business to the next level and this development will give it the scale and size to serve a much larger base of Indian customers with a high level of quality and care.”