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The importance of TPA in Health Insurance
Posted by :Carol GilmorePosted date : September 24, 2018In HealthComments Off on The importance of TPA in Health Insurance
Prior to 2000 the Health Insurance industry in our country was confined to a few basic insurance plans. With the liberalization of this sector by the Government of India, a galaxy of private insurance companies entered the arena and revolutionized the entire industry with innovative plans and operational methods to woo a large population of citizens who were only to keen to grab at the opportunity. It ushered in an era of customized health insurance protection backed by excellent service.
What is Health Insurance?
It is a contract between you and an insurance company for bearing your expenses in a hospital in the event of future medical emergencies including accidents against a premium, for a fixed tenure, generally a year. Needless to say, it is required to be renewed every year.
Types of Health Insurance:
The Health Insurance Plans are broadly classified as:
Individual Health Insurance: Designed to provide coverage to individuals for a specified sum with features to suit his needs and affordability.
Family Floater Insurance Plans: You and your family are covered for health emergencies and you and any member of your family may utilize the coverage to the extent of the sum assured.
Group Insurance Plan: Companies buy this plan for their employees as a group. The cover may not always be comprehensive.
The health plans have many variants now and you need to analyze your needs before buying a plan.
How does the Health Insurance function?
In case of a medical emergency, you need to get yourself treated in a hospital as an in-patient. If you are covered undermedical insurance plans, your expenses are borne by the insurance company. There are generally two methods of payment, apart from a few exceptional features available in some policies.
Cashless: The bill relating to your hospitalization expenses is directly paid to the hospital by the insurance company after due approval subject to the sub limits defined in your policy.
Reimbursement: You submit your hospitalization bill to the company after the treatment as per norms and the company reimburses you with the approved amount subject to the prescribed features in your policy.
The need for TPA:
With the present high penetration, diversity of health insurance plans and the complexities of rendering service of a consistently high quality necessitated the need for professional organizations capable of managing the myriad operations of health insurance industry. TPAs or Third Party Administrators are such outsourcing entities who hold a license from the IRDA to provide management solutions to the industry. They act as intermediaries in the system. The stakeholders are:
The Insurance Companies.
Healthcare Providers (Hospitals and clinics)
The policy Holders.
The concept of TPA was introduced by the IRDA in the year 2001. They are entrusted with a wide gamut of activities encompassing all the aspects of the Health Insurance industry and additionally, health care. Their primary area of operations involves processing your claims and settlement of your hospital bills, be it cashless or reimbursement. They may be broadly listed as:
Accepting intimations of treatment.
Approving cashless claims.
Other activities involving:
Managing Healthcare provider network
TPAs are known to provide the following value-added services for your benefit.
Availability of beds.
Maintenance of 24 hours toll-free help lines.
Dissemination of knowledge on Lifestyle issues and spreading awareness on diseases and ailments.
Managing well-being programs.
Maintaining medical supplies.
Impact of the role played by TPA:
It goes without saying that the TPAs have played a significant role in the industry. They may be tabulated as:
Ensures greater efficiency in the delivery of services.
Assured improved standardization of procedures.
Increase knowledge in healthcare.
Rationalize costs and minimize expenditure.
Develop protocols to minimize delays.
Pave way for reduced premiums and the addition of new features for coverage.
Notwithstanding the pious goals set with the introduction of TPAs, the ground reality reveals a great chasm between the aims and achievements. There is a lot of room for improvement, in which the TPAs have to play a proactive role. The co-ordination amongst the stakeholders and a constant endeavor to upgrade their infrastructure manned by able professionals for various fields can only lead to a meaningful approach. You can learn more from PolicyX.com about the complexities of Health Insurance management and the inherent aim to excel, where the clientele is supreme needs a thorough overhaul of the efforts on the part of the TPA. At PolicyX, Comparison of health insurance plans can be easily done online and you can choose best plan according to your needs.