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Health Insurance policyholders must get the benefit of discounts on hospital bills says IRDAI

Health Insurance policyholders must get the benefit of discounts on hospital bills says IRDAI. Discounts obtained from the hospitals and/or network providers are passed on to the policy holders or the claimants of the health insurance policy.

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Last Updated - May 16, 2023
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Insurance Regulatory and Development Authority of India (IRDAI) has issued a new circular pertaining to discounts offered by Network Providers and/or Hospitals on health insurance claims.

During the course of settlement of claims under health insurance policies, either the insurers or the TPA’s may be obtaining discounts from various Network Provides or also from other hospitals outside the network. As per the circular, it shall be ensured that such discounts obtained from the hospitals and/or network providers are passed on to the policy holders or the claimants of the health insurance policy.

The insurers are required to follow the below procedures with immediate effect, for both cashless services and reimbursements of all the claims on health insurance policies:

1. The insurers and the TPAs shall mandate the hospitals to reflect such agreed discounts in the final hospitalization bill of each claim, whereby the policyholder or the claimant can also be aware of the actual bill raised by the hospital

2. Where the admissible claim amount is more than the Sum Insured, the agreed discount shall be effected on the gross amount raised in the bill, before letting the policyholder or the claimant bear the costs over and above the eligible claim amounts.

3. Where the health insurance policies have co-payment or the deductible conditions, the insurer or the TPA shall ensure that said co-payment or deductible is effected only after netting of the discounts offered by the hospital, if any.

4. The insurers and the TPA’s shall ensure that every discount received or agreed to be received from the hospital is passed on the policyholder or the claimant in respect of the underlying claim only in absolute monetary terms.

5. The above circular will ensure that the insurers or TPA’s do not make money on the discounts earned from the hospitals and pass on the same to the policyholders/claimant.

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