Role of Third Party Administrators (TPA)

Rajan Subramaniam, CEO

Vipul MedCorp TPA Pvt Ltd

Role of TPA
TPAs are licensed by Insurance Regulatory Development
Authority (IRDA) to act as a Third Party Facilitator between
Insured & Insurer and offers the following services:
Cashless medical service facilitation at Network Hospitals
upto limit authorized by Mediclaim / Hospitalization Insurance
Claim processing and reimbursement, for Non-Network
Hospitals
Cost containment services for Insurance Companies and
Insured with inadequate insurance
Online assistance to Insured during hospitalization and filing
of claim documents
Enrollment of data / insured details and ID Card issuance
MIS / Reports to Underwriter (online / offline) and Insured

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 Flow Chart

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TPA Infrastructure
& Service Structure
All India set-up, with well equipped offices for client
handling and decentralised set up.
All India Network Hospitals for cash less service with
negotiated rates and discounts.
Web based software for online transactions. E Cards
24 X 7 Call Center and Toll Free Lines
Trained manpower in client relations, medical
assessment, systems & IT, finance, claims, etc.
Strong IT set-up viz., data server, web server, VPN /
leased lines, back-up, firewalls, etc.

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 Relationship Matrix

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TPA,s V/s Insurer

• TPA,s act as Complete back office set up for the Insurer. All
underwritten policies are collected by TPA,s and enrolled and ID
cards and Guide books issued to Insured.
• Claims are settled by TPA,s under cash less scheme and also for
reimburesement and amounts are reimbursed to TPA,s either on
float or on Single window (Direct Banking ) platform
• TPA,s acts as custodian of Insurer fund and is responsible for timely
settlement of claims, Service level delivery , Cost containment and
maintenance of float accounting.
• TPA provides data/MIS on enrollment , claims , CRCM, Call center.
• TPA , responsible for grievance redressal.
• Insurer audits the paid files and also validates service level
deliveries.
• TPA provides the complete IT platform with online access given to
Insurer, analysis of data/claims , which acts are underwriting tools.
• TPA acts as Gate Keeper and is responsible for fraud management.

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 Enrollment
All underwritten data of members is collected by TPA for
Enrollment. Insurers have now started giving electronic data and
online enrollment is now possible.
Corporate clients intimate additions and deletions on a periodic
basis to Insurer with a copy to TPA. Corporates have started
uploading data directly into TPA system
All fields of the Insured are captured by TPA,s and ID card are
generated and couriered to Insured directly along with guidebooks.
Insured/Insurer can track the enrollment/ID cards issuance and
Dispatch details from TPA , Websites
E cards can be generated from TPA website against Policy No / Card
No.

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E-Card

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 Cashless Service
Planned Hospitalization
Insured Approaches TPA Network Hospital with doctor prescription or meet
consulting doctor.

Emergency Hospitalization
Insured Rushes to nearest Network/Non-Network Hospital
Inform TPA/Insurer about the situation.

At the Time of Admission

TPA ID-Card is produced at Hospital reception
Hospital Fills-up pre-authorization form (Standardised documents)
Part I deals with name, card no., corporate name, etc.
Part III deals with declaration, previous policy/claim details, signatures.
Hospital will fill Part II – details like presenting complaints, clinical finding,
line of treatment, past ailment history, date of admission, approx. duration
of hospitalization, approx. costs (with break-up), signature of treating
doctor.

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Authorization & Discharge

Authorization
TPA,s assess the pre-authorization request based on sum insured,
clinical eligibility.
Query if any, will be faxed to hospital. Insured will be informed on
phone.
Hospital will be given an authorization based on eligibility.

At the Time of Discharge

Insured to pay for all non-covered services like, registration fees,
telephone bills, non-covered treatments, energy/soft drinks,
chocolates, attendants rooms, etc.
Insured to verify and sign hospital bill. To sign a claim form and leave
all original documents at hospital. Xerox of relevant documents can be
taken.
In case original investigation reports like, ECG, x-ray plates are
required for future reference, insured to send request advice to TPA

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 Claims Reimbursement
In case insured avails treatment at non-network hospital, he pays
the treatment cost and claim a reimbursement from TPA.
30 days pre and 60 days post hospitalization can also be claimed
for both cashless and reimbursement hospitalization.
Insured to fill-up claim form and submit along with following
original documents:
Doctors first prescription
Discharge summary
Hospital bills with all break-up
Investigation reports (x-ray, ECG, etc.)
All relevant medicine bills, pharmacy prescriptions, etc.
TPA will process the claim and e-mail/courier discharge voucher
along with claim break-up to Insured, which will be signed and
returned back to TPA and Cheque will be dispatched to insured.

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Discharge Voucher
ANNEXURE 1 : Payment Details Calculation Break-up For Claim File No: 09RB01RGA0113

Patient Name : SANGEETA JAIN Policy Number : 130200/1302072812280001

Case Remarks :
Claimed Amount : 16218

Bill Amount Deductions Discount Payable Amount

Account Head
ROOM TARIFF 2400 0 0 2400

ROOM 2400 0 0 2400

ICU 0 0 0 0

NURSING CHARGES 0 0 0 0

OTHERS 0 0 0 0

PROFESSIONAL CHARGES 1600 0 0 1600

SURGEON/PHYSICIAN 0 0 0 0

ASSISTANT SURGEON 0 0 0 0

ANEATHESIST 0 0 0 0

DOCTOR CHARGES/DMO/RMO 0 0 0 0

CONSULTATIONS (IP) 0 0 0 0

CONSULTATIONS 1600 0 0 1600

OTHERS 0 0 0 0

MEDICINES 1832 0 0 1832

PHARMACY 0 0 0 0

MEDICINE HOSPITAL 0 0 0 0

MEDICINE FROM SHOP 1832 0 0 1832

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 Discharge Voucher
ANNEXURE 2 : Details of Deductions Made (if any) For Claim File No: 09RB01RGA0103
Patient Name : Rajvardhan Policy Number : 130200/1302072812280001

Claims
S.No. Department
Bill No. Main Head Sub Head Amount Deduction Reason For Deduction
1 01 MEDICINES MEDICINE FROM SHOP 16 16 VASELLINE

2 171 MEDICINES MEDICINE FROM SHOP 59 59 FAIR & LOVELY

3 193 MEDICINES MEDICINE FROM SHOP 44.5 44.5 BILLS WITHOUT patient name NOT ACCEPTED.

4 193 MEDICINES MEDICINE FROM SHOP 27.04 27.04 BILLS WITHOUT patient name NOT ACCEPTED.

5 193 MEDICINES MEDICINE FROM SHOP 78 78 BILLS WITHOUT patient name NOT ACCEPTED.

6 385 MEDICINES MEDICINE FROM SHOP 1 1 INVOICE WITHOUT PATIENT NAME

7 49 MEDICINES MEDICINE FROM SHOP 69 69 BILLS WITHOUT patient name NOT ACCEPTED.

8 49 MEDICINES MEDICINE FROM SHOP 56.32 56.32 BILLS WITHOUT patient name NOT ACCEPTED.

9 49 MEDICINES MEDICINE FROM SHOP 44 44 BILLS WITHOUT patient name NOT ACCEPTED.

10 49 MEDICINES MEDICINE FROM SHOP 38.5 38.5 BILLS WITHOUT patient name NOT ACCEPTED.

11 542 MEDICINES MEDICINE FROM SHOP 27.25 27.25 BILLS WITHOUT patient name NOT ACCEPTED.

12 542 MEDICINES MEDICINE FROM SHOP 42 42 BILLS WITHOUT patient name NOT ACCEPTED.

13 542 MEDICINES MEDICINE FROM SHOP 68.52 68.52 BILLS WITHOUT patient name NOT ACCEPTED.

14 542 MEDICINES MEDICINE FROM SHOP 44.52 44.52 BILLS WITHOUT patient name NOT ACCEPTED.

15 542 MEDICINES MEDICINE FROM SHOP 14 14 BILLS WITHOUT patient name NOT ACCEPTED.

16 542 MEDICINES MEDICINE FROM SHOP 3.46 3.46 BILLS WITHOUT patient name NOT ACCEPTED.

17 542 MEDICINES MEDICINE FROM SHOP 25.98 25.98 BILLS WITHOUT patient name NOT ACCEPTED.

18 542 MEDICINES MEDICINE FROM SHOP 24 24 BILLS WITHOUT patient name NOT ACCEPTED.

19 750 MEDICINES MEDICINE FROM SHOP 515.22 515.22 med. return.

20 867 MEDICINES MEDICINE FROM SHOP 23 23 BILLS WITHOUT patient name NOT ACCEPTED.

21 867 MEDICINES MEDICINE FROM SHOP 25 25 BILLS WITHOUT patient name NOT ACCEPTED.

22 983 MEDICINES MEDICINE FROM SHOP 129 129 HEAD & SHOULDER

23 832 MEDICINES MEDICINE HOSPITAL 85.87 85.87 med. return.

24 832 MEDICINES MEDICINE HOSPITAL 314 314 med. return.

Grand Total 1774 1774

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Software, Web Access & MIS

TPA,s have an integrated software solution and a robust back end
data mechanism . It also gives online access to insurer, insured and
hospital through their website.

The Insurer and Insured get access to following online modules:

Enrollment data and card status & E Cards
Claims intimated, processed and settled.

TPA,s also give periodic MIS of following

Disease wise, Age wise & Geographical wise claims analysis.

Incurred Claims ratio. (Office wise, Agent wise)

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 Claims Control

Original Bills are verified & scrutinized against Standard

Discounted Tariff
Cost Containment by Medical procedure audit & bill scrutiny
2nd Medical opinion taken for complicated cases
Re-pricing done on case to case basis
Investigations of Indoor records for doubtful cases.
Implementation of package rates for surgical procedures.
Spot Investigation of Cashless cases.
Endorsement of banned hospitals in the policy for
reimbursement.
Introduction of Sub limits for room, doctor fees,
Consumables etc.

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TPA,s v/s Insured

• Insured obtains TPA cards, cash less service ,
claims settlement and support services,
including, 24/7 information/ helpline .Querries on
emails
• Timely Grievance redressal. All TPA,s have a
grievance redressal mechanism well monitored
by Insurer, IRDA and also accountable to
Ombudsman, Consumer forums.
• Corporate Help Desks, Awareness Campain,
CRCM cell , Mobile help lines. On line web
access for Ecards and information on enrollment
, claims , Network Hospitals and Infrastructure.
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 Service Deliverables

Services TAT

Ecard Within 72 hrs

Laminated Cards within 7 days

Querry Generation 4-7 days

Claims Settlement 7 days

Payment Within 3-4 days of DV receipt

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TPAs v/s Hospitals

MOU defining relationship
Hospital to render Cashless Service to Insured
Fax pre-authorization request form duly completed
Reply to query raised (if any)
Authorization letter from TPA
In case of further authorization, to send the indications for
extension of the length of hospitalization along with the current
line of treatment
Further authorization from TPA
Smooth discharge of the Insured
Submission of bills duly supported by stickers / invoices of lens /
implants, etc.
Monthly reconciliation of accounts
TPA to pay within MOU terms and policy conditions
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 Hospital Empanelment Process
TPA empanel Hospitals based on their assessment and screening process
viz.
Screening of Hospital
Review of Hospital application form, rate list, etc.
Onsite assessment
Monthly / Yearly feedback to decide on renewal

TPA look at the following criteria while empanelling a Hospital:

Infrastructure and facilities available
Quality of service rendered
Patient care background
Bed strength and availability
Management background and past track record
IT infrastructure / computerization
Mediclaim policy conditions
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Expectations
Hospital from TPA
Timely authorization of Cashless request
Timely payments of the Claims
Efficient working system

TPA from Hospital

Judicious admission of the Insured
Courteous treatment to Insured
Timely discharge of the Insured
Efficient working system
Minimum cost structure
Timely and complete submission of bills with all required medical
documents
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 Cost Structure
& Claims Control
High Claim Ratio (110% +) has made medical insurance
unviable and unprofitable. TPA,s play a major role in
cost containment and last 3 yrs , the average
cost/incidence is controlled . ICR also has shown a
downward trend.
Service provider to built cost structure keeping in mind
Sum Insured (SI) (Higher SI can absorb higher costs)
Policy terms and conditions (Capping etc.)
Standardized rates offered by TPAs / Insurer
Improving volumes with optimal cost mix is a WIN WIN
Solution. TPA,s have now started a Preferred Network
of providers.
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TPA,s in Mass policies

• Plays a crucial role in Mass policy scheme (RSBY,
Universal Health Scheme) implementations .
• Preparation of Enrollment Software as per guidelines of
RSBY Schemes. Liason with Ministry , NIC, Nodal
agencies.
• Preparation of Transaction Software as per guidelines.
Networking of Hospitals in Rural areas and installation of
Bio Metric readers and training.
• Enrollment of Beneficiaries on site ,Personalization &
Issuance of Smart Cards
• Transfer of data to the Server. Maintenance of Distt
servers , kisoks (365 days enrollment)

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 TPA Activities
• TPA Collects Soft Data from Govt / Nodal Agency & enter
the same in their Data Server
• TPA Marketing Team Liases with Village Panchayat / BDO &
organise Enrollment Camps. Pre Enrollment awareness
camp is generated by TPA,s.
TPA,s.
• On the Date of Enrollment, the TPA representative, along
with the Smart Card Vender organises Photo Capturing and
Thumb Impressions of the Head & Other Eligible Members of
the Family and on site smart cards are issued
• The Captured Data is Uploaded in TPA Data Server .
• Cash less services are rendered in Network Hospitals after
verification of smart card at Hospital reader. (Paperless
transaction).
• TPA,s responsible for scheme implementation.

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Operational
Flow
Nodal Agency

BPL Family

Thumb Impression Photograph Insurance Company

Smart Card
Validation

Assistance

Hospitalisation

Network Hospital

Cashless Granted

Bill Settlement

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 Issues Faces by TPAs
Health Insurance delivery is an extremely sensitive operations and
many a times , the blame moves on to the TPA,s.
Delivery system/operational protocol needs to be standardised
across all stake holders.
Delays in collection of enrollment data , claims history. Electronic
data transmission is the answer.
Timely payment of claims dependant on Insurer,s timely float
reimburesement. Single Window Banking Channel is the way
forward.
TPA,s are getting notices from IT deptt for TDS deduction on
Hospital Payments. TPA,s are only reimbursing claims on behalf of
Insured and is not availing any service or deriving any income from
Hospitals , hence is not liable for TDS deductions.

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Need of the Hour

Standardization of service/delivery paramaters.
Electronic data transmission amongst all stake holders.
Online claims payment by Insurer.
Adoption of standardized package costs/ Rates for
common surgical procedures (Cataract, etc.) with
Hospitals . (Need for a Health Regulator)
Transparency in the treatment cost, billing, discharge,
etc. Hospitals being prepared for Standardised billing.
Hospitals, TPA,s and Insurer to participate in the
process of Cost Containment with long term view of
increasing volumes under Health Insurance

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