India intends to bolster supervision over the claims portal to combat escalating healthcare expenses, according to a report.
In a significant development, the Indian government is planning to move the National Health Claims Exchange (NHCX) from the Health Ministry to the Finance Ministry, with the Insurance Regulatory and Development Authority of India (IRDAI) as the likely regulator. The proposed change aims to address the issue of hospitals inflating treatment costs and overcharging those with higher insurance covers, as revealed by government analysis.
The NHCX serves as a digital transaction layer connecting insurers, third-party administrators (TPAs), and hospitals, enabling seamless claim settlement and verification. By consolidating the platform under the finance and insurance authorities, the move is expected to improve transparency in pricing and billing, reducing opportunities for inflated claims.
Stronger regulatory supervision is another key aspect of this shift. Currently, the NHCX operates under the National Health Authority (Health Ministry) but is not directly regulated by IRDAI, which oversees insurers but not the claims exchange platform itself. Bringing the platform under IRDAI's purview would unify regulatory control over insurers and hospitals in the health insurance ecosystem, enabling more effective monitoring.
Data-driven detection of inflated claims is another benefit of this move. IRDAI inspections and data analysis have shown that hospitals tend to overcharge procedures when they are aware of the coverage limit of patients' policies. Having the exchange under IRDAI will facilitate continuous data monitoring and timely interventions against such practices.
The proposed change is also expected to curb fraud and inefficiencies that have persisted in the sector, contributing to a more sustainable health insurance market. By controlling overcharging at the source, the policy aims to stabilize or reduce premium inflation and improve health insurance accessibility.
Inflated hospital bills lead to higher insurance claim payouts, which in turn push up insurance premiums, making healthcare coverage less affordable for some in India. The slowdown in health insurance premium income growth is due to premiums becoming unaffordable for many, leading to fewer policy renewals. The government's analysis shows that the higher healthcare costs in India are projected to rise by 13% in 2025, exceeding the global average of 10%.
In summary, the shift aims to introduce stricter supervision and regulatory cohesiveness by placing the digital health claims platform under the finance ministry and IRDAI. This is expected to rein in inflated hospital claims, enhance transparency, reduce healthcare costs, and limit unwarranted increases in insurance premiums in India. The development follows consultations with the insurance regulator and comes amidst concerns about the affordability of health insurance premiums in the country. However, the government and IRDAI did not immediately respond to Reuters' request for comment.
- The move to place the National Health Claims Exchange (NHCX) under the Finance Ministry and Insurance Regulatory and Development Authority of India (IRDAI) is anticipated to spur growth in transparency, as it aims to combat inflated hospital claims and increase affordability of health insurance.
- Data analysis reveals that hospitals tend to overcharge procedures, particularly when aware of the coverage limits of patients' policies, and this move to consolidate the NHCX under IRDAI will facilitate continuous data monitoring and timely interventions against such practices, encouraging healthy growth in the health-and-wellness sector.
- By introducing stricter supervision and regulatory cohesiveness among insurers and hospitals, the proposed change is expected to promote growth in a more sustainable health insurance market, in part by minimizing opportunities for fraud, limiting premium inflation, and ultimately making healthcare coverage more accessible to all.
