IMA-HBI says willing to work with insurers for 'rack-rate' for surgical procedures

MUMBAI: The Indian Medical Association - Hospitals Board of India (IMA-HBI) on Wednesday said that it is willing to working with insurers to arrive at standard "rack-rates” on surgical procedures provided it does not impact the quality of treatment provided.

IMA-HBI, which is an association of 30,000 private hospital chains in the country including names like Apollo Group, Aravind Eye Hospital, KMCH, on Wednesday wrote to the insurance regulator IRDAI and General Insurance Council that they must also consider the many issues faced by hospitals.

Citing the November 5 TOI article on general insurers and TPAs joining hands to fix rack-rates for the industry -- IMA-HBI requested the IRDAI to include its representatives for negotiations. In its letter, IMA-HBI has requested among other things -- that the IRDAI form a “costing committee involving all stakeholders to derive at a base rate for various procedures scientifically."

The IMA-HBI also said that the results from its pilot study carried out in Tamil Nadu in March 2018 should be taken into consideration — as it factors in costs for consumables, ward equipment, accommodation, medical staff fee, ICU, diagnostics, investigation, etc. "We wish to be part of the "Price Fixing Committee" initiated by the insurance sector as we are the representing body for service providers," said IMA-HBI.

“In our study, we have looked at actuals — accommodation cost has been worked out at Rs 2036 /bed day at 50% ward occupancy, employee cost at Rs 2,212 / bed day, surgery costs at Rs 1,293 per hour….Now if we cut costs without rationalisation there could be serious checks to quality. Not just for private mediclaim schemes — but also for national health schemes like Ayushman Bharat and state health insurance schemes," said Dr A K Ravikumar, vice-chairman, IMA-HBI, quoting from their March 2018 study. "When insurance companies want hospitals to do cases for very low packages e.g if they want it for Rs 9,000 when a lap appendicectomy costs Rs 10,000 it will become practically unsustainable and will lead to quality compromise,” he added.

But, apart from IMA-HBI, which is the largest body of private hospitals, there are smaller associations like Private Hospitals and Nursing Homes Association (PHANA), which might hold out. PHANA representatives were not available for comment. Earlier this month, PHANA which has more than 400 hospitals in its network, boycotted "common rack rates" fixed by the four general insurance companies. Unhappy over what they termed was "bargain-bin rates" they refused to honour cashless claims in April in Karnataka -- putting thousands of policyholders at great inconvenience.

Source: The Times of India