The big medical insurance loot

Kurla resident Komal Patel (name changed) had a kidney stone problem and needed to undergo lithotripsy — a non-invasive procedure which breaks up small kidney stones using shockwaves. Patel’s doctor told her that lithotripsy would not cost her more than Rs30,000, but the 60-year-old was in for a shock when Kohinoor hospital in Kurla charged her Rs84,000 for the procedure alone.

Patel got two bills (DNA is in possession of them) from the hospital — the first mentions the cost of procedure as Rs29,346. That bill was a mistake. The third party administrator of Patel’s medical insurance policy, MD India Healthcare Services, erroneously assumed that she had a policy with a private insurer. When they realised their mistake (Patel had a policy with the National Insurance Company), they issued a second bill and charged Rs84,699 for the procedure.

Urological surgeons from SevenHills Hospital as well as RG Stone Urology and Laparoscopy Hospital in Khar told DNA that the cost of a plain lithotripsy procedure that Patel underwent is
between Rs25,000 and Rs30,000.

Patel’s case is an example of the murky and unregulated world of medical insurance in the country. Her family wants to know why the cost of the procedure varies so much when it comes to private and public insurance policies.

Swapnil Jadhav, a customer care executive at MD India, told DNA that they had no role in fixing the cost of the procedure. "In September 2011, GIPSA (an in-house organisation of the four state-owned insurance companies in the country: New India Assurance, National Insurance, Oriental Insurance and United India Insurance) set package prices for certain medical procedures. Hospitals opted for these packages. So, anyone covered by government insurance will have to pay the prices set by them," he said.

This, however, does not explain the reason for the massive difference in the cost of the procedure. When DNA called the GIPSA office in New Delhi, NS Dhillon who introduced himself as an employee of GIPSA refused to comment.

Insurance activists and doctors DNA spoke to said they had no idea if GIPSA negotiates the price of packages with hospitals and the criteria to fix these rates. Some even raised questions about GIPSA’s legal standing, saying there is total lack of transparency about the dealings of the organisation.

At the end of her hospital stay, Patel ended up spending an additional Rs27,000 from her own pocket. Her relative, lawyer and activist Jitendra Gupta, said: "They took eight hours to complete the discharge formalities. By the time we realised that we had to pay Rs27,000 from our pocket, it was already 10pm. We had to pay and get Patel home because if we hadn’t, we would have had to pay for an additional day in the hospital. We did not even have the time to ask why the bill was inflated and why our insurance company was not covering it," Gupta told DNA.

As if this ordeal was not enough, Patel’s kidney has not shrunk sufficiently despite the surgery. She might have to go for another operation. "Who knows how much that will cost," said a distraught Patel. She is a living example of how patients are the ultimate sufferers.

A victim’s tale
Kurla resident was told lithotripsy surgery would cost up to Rs30,000, but Kohinoor hospital charged her Rs84,000 
She was given two bills - the first of Rs29,346 by mistake. When the third party administrator realised she had a policy with the National Insurance Company, they charged her Rs84,699
The 60-year-old also had to pay an additional 27,000