State warns insurance company of invoking penalty clause


The Tamil Nadu government has warned United Indian Insurance Company (UIIC) of invoking penalty clause, if it fails to instruct all hospitals empanelled under New Health Insurance Scheme, 2018, on ensuring cashless treatment to pensioners/family pensioners.

Under the scheme, healthcare assistance is provided to the beneficiaries on cashless basis up to ₹4 lakh for a block period of four years for the accredited treatments/surgeries in the hospitals approved by the UIIC.

“Any failure to abide by the contract in service delivery will invite penalty clause and the amount will be recovered from the UIIC and settled to the beneficiaries,” said S. Krishnan, Additional Chief Secretary, Department of Finance, in a letter addressed to UIIC Divisional Manager, Chennai, dated July 12.

The warning comes in the wake of complaint from the State president of Tamil Nadu Retired Officials’ Association to the government.

Contrary to the “cashless” treatment for all the procedures covered under NHIS, empanelled hospitals were seeking large sum of money for providing treatment and also refuse to admit pensioners/family pensioners, the association complained.

The association requested the government to issue suitable orders to the UIIC and empanelled hospitals to provide cashless treatment without any hassle.

Mr. Krishnan recalled that other instances had also been brought to the notice of the government that some empanelled hospitals insisted on payments over and above the insurance claim from the beneficiaries.

Besides, those hospitals also refused to implement cashless treatment leading to payment of full amount in view of emergency, he said.

“Though there is a provision of penalty clause in the agreement executed between the State government and the UIIC under the NHIS, 2018, the government has not so far invoked the same,” the Additional Chief Secretary said.

As per Clause 22 (1) of the guidelines for implementation of the NHIS, 2018, for pensioners/family pensioners, it is indicated that in case of deficiency in services or failure to provide services as required by terms of scheme will attract penalty as may be determined by the government, subject to the minimum of five times the amount of the expenditure incurred by the government or beneficiary due to non-compliance.

Tamil Nadu Government Employees’ Association office-bearer C.E. Kannan said even government employees faced such a hardship in availing themselves of the benefits of insurance scheme.

“We have made several representations to the State government. We expect the government to issue a similar strict instruction to the insurance companies so that no beneficiary is put to undue difficulties during the time of emergencies,” Mr. Kannan said.

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Printable version | Sep 19, 2021 1:16:36 PM |

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