Consumers don’t see worth Due to the long list of exceptions: Mayank Bathwal
Aditya Birla Health Insurance chief executive officer Mayank Bathwal, who joined the Aditya Birla Group in 1994, was instrumental in preparing the health insurance arm in August 2015. In conversation with Mint, Bathwal talks about how standardization of exceptions will affect business development, whether the regulations leave the need for integration and gaps for fraud to expedite the claims process. What’s your perspective on the standardization of health insurance exclusions? Are insurers ready for the change?
One of the challenges from the medical insurance sector is that products have experienced too many exclusions.
Our spouse MMI Holdings Ltd comes from South Africa and when I looked at the current market, I realized they’re in the extreme end of the spectrum in which there are virtually no exclusions and health benefits are excellent. For the Indian market, maybe it was okay to begin with a cost that was affordable given lack of awareness, but that the sector is evolving, it’s essential to maintain removing exclusions.
After we entered the company, we desired to lower the amount of exceptions but if only 1 company does it, the pricing goes haywire. Even if we said no waiting period and addition of OPD costs for four chronic conditions-asthma, blood pressure, cholesterol and diabetes-in that our flagship product, the premiums went high. By omitting or reducing exclusions, you remove a barrier from the policyholder’s mind and the uncertainty if or not a condition is going to be covered or not.
Will rise in premiums due to standardization of exceptions affect your business growth?
It is about the value that we make in the consumer’s mind. We have been promoting products for three decades and I really don’t believe pricing is the question in a consumer’s mind. They are more concerned about the value if their claim will be settled and they get. No consumer might want to save, say $3,000, if it means giving up on benefits that are crucial. So it is about the way you present the offering.
Regulations say that when a policyholder capability is severely diminished by use of medication prescribed by a medical practitioner, the individual will nevertheless be insured. Can this lead to fraud?
Whenever we employ these modifications, there’ll be a period of figuring out what’s the correct way. There could be exploitation from the hospital as well as the policyholder. But we are going to have to find ways and, in the process, there will be some cases where a policyholder that is genuine gets impacted if the insurer gets the result wrong in the event the policyholder is doing the wrong thing, or the insurer will get affected. But even now 10-12% asserts are fraud. We are going to need to manage it but the good thing is, with analytics and data, the ability of insurance companies to identify fraud has become.
An increasing number of people having policies are complaining about long delays in discharge from the hospital. Why is this happening and what’s the solution?
Some part of the delay of making the discharge list such as the process occurs if you choose the compensation route and is routine. What takes is that the exchange of information between the insurance company and the hospital.
The very best method to deal with this is to get a portal where the concerned hospital’s TPA upload the information and the insurer’s staff looks at the information and carries a call. This is going to make the process seamless and that it happens in some of the markets that are mature. We’ve been attempting to get the hospitals’ systems to talk with our systems so that individuals’ data directly gets moved to our own systems. But because we’ve got a network of 6,000-plus hospitals this has not been very efficient and integrating them with all is a mammoth task. For every hospital to incorporate with insurers is a hard job. There is a need for one portal site with which all hospitals and hospitals can integrate. Irdai is speaking about it, although this has not happened so far in India. Part of the method is manual now which takes a long time, thus there’s an urgent need for integration.
What are some of the biggest challenges in health insurance today? How are you currently coping with them?
1 challenge is awareness that is an industry occurrence and I feel a single company can not do much. The need of the hour is to get a campaign similar to that which mutual funds have. But I am confident about consciousness. It’s going to rub off on everyone since they see people in the lower-income category have health insurance, so they will know the need as well.
The next challenge is customers not visiting value because of the list of exclusions but I am trusting this will be solved by the new regulations to a extent. There’s also a need to produce the claims experience smoother. There’s a lot of paperwork. In a company-level, by hand-holding the policyholder to discharge we’re trying to create the cashless procedure virtual.
The challenge is abuse, waste and fraud. And to my mind, this affects two things. One, if there are 10-12% alleged instances of fraud, (then to compensate for it) the pricing is impacted. And second is your claims experience. There might be cases of alleged fraud that might not turn out to be after identification. But analysis is time consuming.