In a significant development the Kerala Private Hospitals Association has instructed their members to withold agreement with insurance companies for their "Cashless Anywhere" initiative. Dr Anvar Ali,General Secretary KPHA has issued a written statement for the members.The statement mentions that,"Insurance companies are publicizing through print & visual media a new scheme named "Cashless anywhere"This is being done without due consultations or taking into consideration the major stakeholders - Private Hospital Managements and its Associations. This scheme has no legal or moral binding on Private Hospitals, especially who have not empanelled with the insurance companies / TPA's.KPHA directive to all Private Hospitals in Kerala is to withhold agreement or providing service under this scheme, till further instructions.The treatment rates or packages, the claim processes, and assurance of payments have not been discussed with us and lack clarity. It is understood that "PPN rates / packages" are being promoted which is quite lower than the prevailing Hospital rates and not acceptable.Considering the operational expenses incurred by Hospital managements and especially in view of the proposed salary revision, it will be highly detrimental to the financial viability & stability of hospitals to accept such proposals. Due consultations with KPHA and the stakeholders in Kerala are necessary and only after an agreeable outcome shall we proceed any further with the scheme All Private Hospital Managements are requested to stand together in this to safeguard the viability & sustainability of our institutions"

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Earlier Association of Private Healthcare providers (India) had also written a letter to Chairman IRDA raising the issue of cartelisation by insurance companies.The letter mentions that there is increasing trend that more and more patients are coming through government schemes like CGHS, ECHS and PMJAY. Their rates are at times unviable and do not meet even the operating expenses. The Private Health Care organisations survive through cash paying patients and those coming through private insurance, which we term as subsidisation model. Recently, the Insurance companies have started putting pressure on hospitals in general and on small and mid-size hospitals in particular on fixing of rates, by asking rebate. It has also been experienced that insurance companies are joining hands and working on almost similar pattern of tariffs. This is tantamount to a form of Cartelisation. While this is against the principles of fair competition, it will also lead to deterioration of Medical Services as cutting down the cost will affect patient safety.

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On the cashless for everyone initiative, there are lot of apprehensions among private hospitals and private hospitals are accusing that as service provider and important stakeholders their concerns have not been addressed before announcing a major initiative like this.

Currently, cashless facility is being offered only to Hospitals in the network of insurance companies. However, going forward, now the cashless facility is being offered to customers in the  hospitals outside  network as well. The provision of ‘Cashless Everywhere’ to Hospitals outside the Network is subject to the following conditions:

1. For Planned Admission, the assigned TPA should receive the Intimation about the Planned Admission at least 48 hours prior to the proposed date of admission. The Intimation should be sent by email to the TPA mentioned in the policy.

2. For Emergency Admission, the assigned TPA should receive the Request for Cashless Facility in the Prescribed Form at least within 48 hours after the time of admission.

3. The Hospital where the treatment is to be taken should meet the requirements of the Policy T & C and the Company’s internal guidelines.

4. Cashless Facility would be available only if the treatment is found admissible under the terms of the Policy.

Many leading insurance compnies have already launched the scheme with SOP for all stakeholders.