General insurance firms eye govt's new health plan

IMPACT OF THE SIXTH PAY COMMISSION REPORT

Non-life insurance companies are keen on getting a slice of the Rs 1,000-crore health insurance scheme proposed for 23 lakh retired and serving Central government employees and their families.

According to sources close to the development, since it will be difficult for a single insurance company to manage the scheme single-handedly, insurance companies will be asked to form a consortium for offering the scheme. The scheme may be divided among insurers location-wise.

The health insurance scheme will be available on a pan-India basis, covering 17 lakh employees and 6 lakh pensioners, excluding defence and railway employees.

The scheme will be optional for existing employees, but compulsory for new government employees/new retirees, who would be joining/retiring after the introduction of the scheme.

The new recruits and pensioners will consequently not be provided CGHS facilities. The insurance scheme will run parallel to the Central Government Health Scheme (CGHS).

Insurance companies have said officials from the ministry of personnel, ministry of health and the PMO have been in talks with them for the last three years for introducing the scheme. The Department of Administrative Reforms and Public Grievances (ARPG) has been given the mandate to implement the scheme.

Insurance companies have proposed to ARPG to offer a cashless hospitalisation scheme with outdoor patient department services. The scheme will also cover critical illnesses.

Insurance companies have proposed a hospitalisation cover of Rs 3 lakh along with a corporate floater of Rs 2 to 3 lakh. However, the ministry has asked for Rs 10 lakh corporate floater.

A corporate floater is an additional cover that can be used if the hospitalisation cover is exhausted. Insurers have asked that government hospitals under CGHS be included apart from the empanelled private hospitals for the scheme with rates similar to CGHS. Central government employees pay varying sums between Rs 15 and Rs 150 a month for this facility depending on their ranks.

According to sources, the ministry of health intends to scrap the IPD (inpatient department facilities) from CGHS.

CGHS is currently available only in 24 cities. According to officials, 20 to 30 per cent of population lives in non-CGHS areas. Those pensioners that live in non-CGHS areas are paid a paltry sum of Rs 100 a month for meeting their medical expenditure that does not require hospitalisation.

The Central government pensioners living in non-CGHS areas and their associations have demanded reimbursement of medical expenditure on a par with what is available to the serving employees. Therefore, the health insurance scheme will be highly beneficial to pensioners staying in non-CGHS areas.

Officers in the higher rungs will pay maximum 40 to 45 per cent of the premium, while the lower-grade officers will pay 20 per cent of the premium with the government subisidising the rest.

"Serving employees and existing pensioners shall have the option to opt out of CGHS and subscribe only to the insurance scheme, thus making their own arrangements for OPD needs," said the report.