'Have health-care watchdog or let us regulate it,' says Irdai member

The insurance regulator is keeping an eye on hikes in premiums, said Alamelu T L, member (non-life), Irdai

The health insurance segment may be regulated by the insurance regulator, but the health care market is devoid of any such authority, resulting in people sometimes bearing the brunt of exorbitant hospital bills.

There should either be a separate regulator for the health care segment or the insurance regulator — Insurance Regulatory and Development Authority (Irdai) of India — be allowed to regulate it, said Alamelu T L, member (non-life), Irdai.

“It’s our wish there be a health care regulator, or we be allowed to regulate hospitals as well,” said Alamelu at a Confederation of Indian Industry event.

“We are regulating one portion of the health care segment — the insurers. We try to indirectly regulate hospitals by asking them to come forward for cashless claims. But only a few hospitals have cashless agreement with insurers. The hospitals can keep raising their tariffs and we as an insurance regulator want to protect the public against continuous increase in premiums,” said Alamelu.

She said the insurance regulator is keeping an eye on hikes in premiums. The regulator has also tried to make health insurance simple for the common man. But there are service providers where there is no regulator — they have a free hand (when it comes to price), she added.

Having a regulator would repose public faith in the system and may result in more people getting themselves insured. Insurers have time and again complained that in the absence of a health regulator, the average claim size has been increasing and ultimately, they will have no option but to increase premiums once the loss ratios cross their threshold.

The medical inflation in the country is around 15–20 per cent per year and the premium doesn’t correct for three years at least. Given that medical inflation is higher than general inflation, there needs to be a correction cycle from a pricing standpoint, said insurers.

The non-life insurers received around 3 million health claims; 2.75 million have been settled for around Rs 25,000 crore. Life insurers have settled over Rs 14,000 crore in Covid-related death claims since the pandemic struck.