How IP insurers can deal with soaring health-care claims
HOUSEKEEPING can be a tedious and, at times, painful process. This is especially so when the relevant parties have been left to their own devices for a significant period of time.
And it's exactly so in the case of the five insurers offering Integrated Shield Plans (IPs).
The five - AIA, Aviva, Great Eastern, NTUC Income and Prudential - have been tasked to come up with a standardised set of guidelines based on best practices, as part of the Government's attempt to put the IP industry in order.
The MediShield Life review committee urged the authorities in June to improve the existing regulatory framework by setting "clearer guidelines and rules".
While the insurers are still far from working out the details, they are looking into ways to improve clarity in hospital bills and doctors' fees.
Data from regulatory filings shows that soaring claims have caused their underwriting profit margin to shrivel over the past five years, from 17.9 per cent in 2009 to 3.5 per cent last year.
Industry players say that most unusually high claims come from the private health-care sector.
Last week, the Life Insurance Association, Singapore told The Business Times that there is a need to improve the price transparency of professional and hospital fees within the health-care sector.
It also said that the IP insurers should be able to analyse data to allow scrutiny of unusually high bills. One way to do so is to share claims for common procedures.
But their attempt to do so is fraught with challenges.
The greatest hurdle? Confidentiality issues.
So now they have to determine what information can be shared and find ways to share it.
This aside, it's understood that the insurers have an internal system to flag suspiciously high doctors' fees.
But, even as they question the high bills, the policyholder would have already undergone the treatment or procedure, and the questioning does nothing for the insurers who have to process the claims in the end.
Could the solution be to publish a list of doctors who consistently submit suspiciously high claims? As it is, some private health-care insurers are already practising naming and shaming on their websites.
But, first, the Health Ministry and the Singapore Medical Council will have to weigh in on what constitutes overcharging. This will then pave the way for insurers to decide who and what to include in the list.
Drastic as this suggestion may sound, it is time to work towards greater transparency. After all, the businesses of health-care and insurance encompass social responsibilities that must not be overlooked.
THE BUSINESS TIMES