Key Facts

A parliamentary committee scrutinized India's four public sector general insurance companies (New India Assurance, National Insurance, Oriental Insurance, and United India Insurance) for the persistent underutilisation of their joint in-house Third-Party Administrator (TPA), Health Insurance TPA of India Ltd. Despite establishing the common in-house entity in 2013 to rein in processing costs and streamline cashless health insurance claims, public insurers continue to outsource a predominant share of claims processing to private TPAs, incurring higher commission payouts. The committee highlighted that excessive reliance on private intermediaries without adequate oversight leads to higher claim rejection rates, delays in emergency hospital discharge, and elevated premiums for retail policyholders.

GK Context

Third-Party Administrators (TPAs) are specialized entities licensed and regulated by the Insurance Regulatory and Development Authority of India (IRDAI) under the IRDAI (Third Party Administrators - Health Services) Regulations, 2016. TPAs act as processing intermediaries between insurance companies, policyholders, and network healthcare providers, managing cashless hospitalisation pre-authorisation and claim reimbursements without bearing underwriting risk. IRDAI has recently pushed for a 100% cashless treatment facility across all empaneled hospitals under the 'Cashless Everywhere' initiative.