The story so far: The Health Ministry along with the Insurance Regulatory and Development Authority of India (IRDAI) are working on measures aimed at allowing patients to access quality healthcare swiftly and with reduced out-of-pocket expenditure. The Ministry and IRDAI are launching the National Health Claim Exchange (NHCX), a digital platform which will bring together insurance companies, healthcare sector service providers and government insurance scheme administrators.
How is the NHCX expected to work?
The NHCX will serve as a gateway for exchanging claims-related information among various stakeholders in the healthcare and health insurance ecosystem. The integration with NHCX is expected to enable seamless interoperability of health claims processing, enhancing efficiency and transparency in the insurance industry, benefiting policyholders and patients, said the Health Ministry.
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Asked if the system will help to accommodate the dynamic and diverse healthcare system of India, S. Prakash, MD & CEO designate, Galaxy Health and Allied Insurance Company Limited, said the healthcare landscape has been evolving to align with IRDAI’s objective of achieving ‘Insurance for All by 2047’. “The insurance industry is poised to support the implementation of this system by facilitating streamlined interactions between hospitals and insurers, establishing a seamless, paperless, and secure contractual framework. Acting as a centralised hub for all health claims, the NHCX will significantly alleviate the administrative burden on hospitals, which currently contend with multiple portals for various insurers,” he explained. Twelve insurance companies and one TPA (Third Party Administrator) have completed the NHCX integration.
What about cashless claims?
A timeline has been fixed for insurance claims of cashless claims. The insurance authority has said that all cashless claims have to be processed within three hours of the receipt of discharge authorisation from the hospital. The insurance regulator has set the insurance provider a deadline of July 31 to put systems and processes in place to ensure the smooth facilitation of this latest directive.
While the actual on-ground launch of both the NHCX and time-bound insurance clearance is expected to roll out soon, a senior Health Ministry official confirmed that over 30 insurance companies are already onboard the NHCX platform while effort and awareness drives are going on to bring in the hospitals.
What are some other incentives on offer?
To encourage adoption of digital health transactions and digitisation of patient health records in the country, the National Health Authority had announced financial incentives under the Digital Health Incentive Scheme (DHIS) from January 2023. Under the DHIS, there is a provision that for every insurance claim transaction through NHCX, financial incentives of ₹500 per claim or 10% of the claim amount, whichever is lower, would be given to hospitals, according to a Health Ministry note.
Why is NHCX being brought in?
A paper titled, ‘Health Insurance Coverage in India: Insights for National Health Protection Scheme’, noted that health insurance is an important policy strategy to provide health care services as well as reduce high out-of-pocket expenditure which burden individuals. It points out that for all India, the hospitalisation cases are highest when insured from private purchase (54.4 per 1,00,000 persons). In urban areas, cases for inpatient care are observed to be highest for those covered by government-funded schemes (60.4 cases per 1,00,000 persons). On the contrary, in rural areas, in-patient cases are substantially higher for those purchasing private insurance (73.5 cases per 1,00,000 persons). Also, overall in-patient cases are higher for urban areas compared to rural areas.
Arguing for the NHCX, the Health Ministry states that the platform will help in standardisation and interoperability of health claims and will bring in seamless exchange of data, documents and images between payer (insurance company/TPA/government scheme administrator) and provider (hospital/lab/poly clinic). Additionally, it will enable transparent and efficient claims processing and reduce related operational costs, it said. Industry experts also note that the platform, through uniform data presentation and centralised validation of claims data, could bring in a more standardised approach to healthcare pricing. “This not only improves efficiency but also fosters predictability and transparency in healthcare costs for all parties involved. The transition to digitisation is also anticipated to significantly decrease the cost of processing claims,” say experts.
What are the challenges?
Health insurance contributes to approximately 29% of the total general insurance premium income in India. The primary hurdle in health insurance today lies in improving the relationship between hospitals and insurance companies, said Dr. Prakash, adding that the push towards digitisation requires active involvement from both parties, necessitating upgrades to current IT systems and enhanced workforce training. “Issues such as discharge delays and miscommunication between hospitals and insurers further complicate matters. Building trust among policyholders hinges on delivering efficient services. The NHCX portal aims to streamline the claims process by bringing all stakeholders onto one platform, reducing claim times and standardising procedures. While challenges like data breaches are being effectively tackled, the NHCX stands as an ongoing benefit for all involved, facilitating smoother operations within the healthcare space,” he said.
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Parthanil Ghosh, director and chief business officer, HDFC ERGO General Insurance Company Limited, said the benefits from the platform are many. “The NHCX will reduce manual workload and accelerate the entire process, enabling easy tracking leading to better customer satisfaction and also help in fraud detection,’’ Mr. Ghosh said.
