A committee set up by the Insurance Regulatory and Development Authority (IRDA) to look into the functioning of third party administrators has suggested that a health council be set up.

The committee wants the council to be a self-regulatory body of third party administrators with members from all segments of stakeholders, including insurance companies, third party administrators, hospitals and consumers.

IRDA had formed the panel in November 2008 to look into the scope of function, best practices, turnaround time and financial aspects of third party administrators (TPAs). The council would enable insurance companies and TPAs to follow simple and standardised pre-authorisation and claim forms. Also, third party administrators and hospitals would have a common software platform to cut down the delay in processing pre-authorisation and settlement of claims, S.B. Mathur, Secretary General, Life Insurance Council, and Head of the TPA Committee, said.

This, he said, would help in making it easier for insured patients to get treatment without having to pay cash. Bringing in the “cashless” system of getting medical treatment (the customer pays only the insurance premium; when he gets medical treatment the insurance company will pay the hospital directly) was meant to be a key role of TPAs, and this has not happened so far.

Another recommendation made by the committee is to bring about professionalism among TPAs in terms of providing information to policyholders and help in claim settlement, said Mathur.

The health council will also look into issues such as TPAs not answering calls made by customers, time taken by the administrators to settle claims, insurance companies providing third party administrators with float funds, TPAs settling hospital bills in time and overcharging by hospitals.