Standard Treatment Norms on Cards

[Apollo Munich CEO]

Both the health insurance and healthcare industry seem to be
converging on the need for standardising treatment protocols with cost
indicators and a combined group is ready with 20 most common surgical
procedures and medical conditions.

As hospitals do not follow any ailment-specific treatment processes,
the absence of a standard treatment protocol has often led to vast
differences in treatment procedures and consequent costs for seemingly
identical ailments across hospitals. This situation has increasingly
led the health insurance industry and healthcare providers being at
cross roads as instances of over treatment or more than necessary
diagnostic testing for insured patients have been on the rise.

Industry body Ficci, in consultation with heath insurance companies
and healthcare providers such as Aiims, Medanta, Arvind Eye Care and
Narayana Hrudayalaya, has developed a list of ‘standardised treatment
protocols and cost indicators’ for 20 common procedures and medical
conditions.

“This has been prepared. Based on its acceptance, the effort could be
channelised to cover 50 surgical procedures. We were in touch with the
health ministry and Insurance Regulatory Development Authority on the
issue. The list will be submitted to the health ministry in the next
four-six weeks,” said Narottam Puri, advisor, Ficci Health Services
Committee and chairman, National Accreditation Board for Hospitals &
Healthcare Providers.

Experts also point out that this list is a notable progress from the
point of view of cost standardisation and could be expected to reign
in arbitrary treatment costs. Eventually, one of the favourable
impacts could be on the adverse claims ratio and related outgo for the
health insurance industry, which collected around Rs 11,000 crore as
premium last year.

According to a new report by Foundation of Research, Training and
Education in Insurance, an initiative of Ficci and ING Insurance,
general insurers have a deficit of Rs 6 for every Rs 100 collected as
premium because administrative cost collection, agent commission and
third party administrator fees as well as claim pay-outs account cost
around Rs 106. Plus, claims payout ratio at an industry-level is
around 100-150 per cent, which means insurers pay more claims than the
premium collected.

Puri added the initial list contains treatment protocols with cost
indicators for cataract, respiratory ailments, diabetes and specific
forms of cancer. After the documents are submitted, health ministry
officials along with a team of renowned doctors are expected to
consider the issue and draw up a standard.

“If this gains ground, private hospitals and health insurance could
settle mediclaim easily. Though finalising the standardised protocols
is not an easy task as both diseases and their treatment depend on
individuals, but this is a good move,” said Antony Jacob, CEO of
Apollo Munich Insurance and co-chairman, Ficci advisory group on
Health Insurance.