What does one do regarding the Cashless hospitalization withdrawal?

We all have heard of Shylock from The Merchant of Venice, one of Shakespeare’s work classified as a comedy. But, at least in between, when Shylock insists that Antonio repay the debt he is unable to pay, with a pound of flesh, it is more tragic than comical. There is a happy ending when the lawyer arguing for Antonio, allows Shylock to go ahead, but not shed blood… for as per contract, he can take his pound of flesh and not blood. Shylock is cornered and there is a happy ending. A modern day play is unspooling now…

Today, those with medical insurance policies are a worried lot… much like Antonio would have.  Cashless settlement has been withdrawn by PSU insurers in most hospitals, except in a select list of 60+ Preferred Provider Network ( PPN ). Private insurers are gloating and approaching people with the apparently winning proposition of Cashless settlement, which they still have in place.

But the point is that, every insurer is suffering due to excessive claims by hospitals.  The tariff card itself is different ( read higher ) if there is an insurance policy. This is the modern day version of extracting their pound of flesh… which they have been successfully doing for years. Insurers have been bleeding and many are making losses. PSU insurers had decided to bite the bullet and have yanked the cashless settlement, in most cases.

It is probably a matter of time before it gets normalized.  The insurers have vowed to talk with the hospitals and hammer out an equitable solution. It is ironical that hospitals should overcharge Insurance companies – they are one of the major sources for business and if anything, should have been offered discounts! It is definitely a mistake from the insurers side too that they have woken up to the problem so late in the day.

The other major area of concern for anyone getting admitted to a hospital, is their practice of benchmarking the charges based on the category of room one gets admitted to. For instance, someone from an A/c single room would be charged much higher for say an operation, conducted by the same doctor, using the same OT, as compared to another from the general ward. This is so much of an accepted practice that hospitals are shocked, when someone even questions this!  Doctors are ofcourse happy with this arrangement as this is jam over butter for them – Hippocratic oath they have taken be damned!

For the public, It again finds it at the receiving end of the stick. There are a few things they need to keep in mind and do-

  1. Many are weighing the idea of switching over to a private insurer because they still have cashless settlement. That’s not a great idea. The problems of the industry are similar. It needs sorting. Tomorrow, even private insurers can withdraw cashless settlement. The main thing is that the underlying problem of overcharging needs to be addressed. That is now being taken up by the PSU insurers, who are negotiating with the hospitals.
  2. Be concerned about the charges, even if they come well within the limits of your policy… for a higher charge will diminish the amount available to claim in that Financial Year and will ensure that the premium suitably goes up, in the next year. Also, that is the ethical thing to do.
  3. Till this problem blows over, it could be a good idea to pay cash and later claim from the insurer. That way, your insurer will not be creamed and you will benefit too ( see point 2 ).
  4. In all but emergency cases, do a bit of asking around. Find out the rates being charged by various hospitals for various procedures, fees charged by doctors for any intervention etc. and then decide.  You will find that you investment of time is more than handsomely rewarded.
  5. If you want your cover to run that extra mile, look at a lower class room or general ward as an option. If it involves just a day or two, this may not be too bad, in any case.  Your claim will be much less and you and your insurer, will benefit.

Please understand that you and your insurer are in it together. If all policy holders turn a blind eye and allow hospitals to overcharge, it will ultimately affect all the policy holders as the premiums will get hiked if the claim ratio is high. Be vigilant. Act sensible. These are what a policy holder needs to do today.

It is just a matter of time before such obnoxious practices are weeded out.  Even this story will have a happy ending… like Antonio’s in The Merchant of Venice!