Page 64 - MEDICAL AND HEALTH INSURANCE

MEDICAL AND HEALTH INSURANCE

works. There will be a likelihood of claim disputes when it comes to related

issues being classified as pre-existing conditions by insurers and denied by

the claimant. It is also incumbent on the insurer to prove the pre-existing

conditions in the event of such a dispute. Hence, the claims are generally
on a 'pay and file' basis, which allows the insurer time to adjudicate the

claim to identify any pre-existing conditions before full settlement of the

claim.

3.2 COST CONTAINMENT

With the escalation of medical costs and with policyholders seeking lower

premiums to contain expenditure, insurers must achieve a balance

between ensuring the viability of the risk and yet making it affordable for

policyholders to continue to obtain protection against their health risk.

Hence, cost containment measures cannot be treated lightly and it is the
responsible of the insurer, together with the policyholder and the provider

to ensure an equitable access of care at reasonable and customary

charges.

The development of 'as charged' PMI policies has opened the floodgates to
claim fraud and abuse, which has seen insurers implementing cost control

measures to curtail rising costs and to prevent claim leakages. Following

are some such cost containment measures.

3.2.1 NO CLAIM DISCOUNT SCHEMES

No claim discounts (NCDs) are borrowed from Motor insurance, that is, the

renewal premium would be discounted if there is no claim in the previous

year. Policies which offer an NCD, normally offer an initial discount for the

first year of the policy and subsequent years of discount up to a maximum
discount that can be allowed.

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