👌👌👌GST on health insurance –editorial by ToI–18% plus more

https://timesofindia.indiatimes.com/blogs/toi-editorials/18-plus-more/

Clipped from: https://timesofindia.indiatimes.com/blogs/toi-editorials/18-plus-more/

TOI Edit

Times of India’s Edit Page team comprises senior journalists with wide-ranging interests who debate and opine on the news and issues of the day.

GST on health insurance should have been lowered. As it is, consumers face other problems too

GST Council needn’t have referred the question whether tax on health and life insurance premiums should be lower to a Group of Ministers. Ministers, opposition politicians, industry figures and sector experts have explained why a 18% GST on health insurance premiums affects insurance coverage as well as public health. Considering that a modest 8,263cr accrued through GST on health insurance premiums, did the issue warrant such a tortuous settlement, with a decision likely only at next GST Council meeting in Nov? A 2021 Niti Aayog paper had highlighted the plight of India’s Missing Middle, who aren’t poor or rich enough to gain from govt schemes or private insurance – 400mn in all. In what’s just as bad, even as govt functionaries enjoy the benefit of central or state schemes, health insurance premiums have been rising in recent years. A survey earlier this year found 52% of respondents saying their premiums had risen by more than 25% in the last 12 months.

Sector’s many woes | There are several other issues afflicting private health insurance systems. The same survey found 43% of respondents struggling with the settlement process in the last three years. Patients often wait for as long as 10-12 hours after they are ready for discharge because companies delay claim settlements. Misselling, ambiguity in contracts and ‘hidden clauses’ often see their claims being denied or met only partially. Claims are regularly rejected because of a pre-existing disease or owing to eligibility other than a pre-existing disease. Companies cite their claim settlement ratio to sell policies but, as experts have pointed out, that data often hides as much as it reveals.

Weak oversight | Making matters worse is poor enforcement of regulations. In May, IRDAI directed health insurers to settle cashless claims within three hours of discharge approval from hospital and institute proper procedure for repudiation of claims. Health insurers were instructed to put requisite systems in place for cashless transactions by July 31. But this deadline has not been met. To take another example, IRDAI has removed the upper limit of 65 years for getting health insurance. But will it actually monitor how many senior citizens above that age are getting health cover? Almost one-third of consumer complaints in India relate to the insurance sector, especially health and life segments. So, we need a far more proactive regulator that insists on transparency and adherence to rules. If and when GST on premiums comes down, health insurance will still be a consumer hazard. 

This piece appeared as an editorial opinion in the print edition of The Times of India.

END OF ARTICLE