Redtape, lack of transparency: Why TN govt's health insurance scheme needs fixing

The spectrum of problems extends from hospitals not accepting the CMCHIS card to making patients pay or compromising on the quality of healthcare.
Redtape, lack of transparency: Why TN govt's health insurance scheme needs fixing
Redtape, lack of transparency: Why TN govt's health insurance scheme needs fixing

On the afternoon of December 14 last year, 70-year-old Abirama S was at her home in Coimbatore when she was gripped by sudden breathlessness and chest pain. She was rushed to a well-known multi-speciality hospital in the city, and was whisked away into the ICU. After the diagnosis, the doctors said she had four blocks in the heart, and was in need of a coronary artery bypass graft (CABG) surgery “as soon as possible.”

Her family was informed that it would cost them nearly Rs.2.4 lakh. Abirama and her husband made a living by making faux flowers, while her son, S Gnanapalani, was a salesperson at a textile store in the city. It was not easy to meet such a huge expense with their income.

Over the first three days, her vitals stabilised and Abirama was moved to a general ward. "They were constantly pestering us to pay the money for surgery,” said Gnanapalani.

When Gnanapalani asked a doctor whether the surgery could be done under the Chief Minister’s Comprehensive Health Insurance Scheme (CMCHIS), he got a curt reply: “Adhila agadhu [It’s not possible under the scheme].”

Next, Gnanapalani met the Liaison Officer (LO) — a government-appointed representative of the CMCHIS who is present at every empanelled hospital.

“The officer looked up our card number on the system, and said that no money had been claimed so far under the scheme, and that we were fully eligible for the procedure under the scheme.”

Total claim amount paid (reimbursement) to government and private hospitals: 2012-2013 to 2015-2016

The beneficiaries can derive a maximum benefit of Rs. 4 lakh over four years with an annual limit of Rs. 3 lakh. There’s also a provision to get coverage of up to Rs. 1.5 lakh for certain procedures. Armed with the LO’s reply, Gnanapalani again questioned the doctor of the hospital, which has an A1 grade under the scheme and a score of above 90 out of 100—one of the highest in Tamil Nadu.

There was a marked difference in his reply now. “I’m not saying that it’s not possible…,” Gnanapalani quoted the doctor as saying, “but it will take time. There’s a long list of patients under the scheme and you might have to wait for months. If you had come as an OP [out-patient], it’s possible to do it under the scheme. But, in an emergency case, it cannot be used.”

This claim is false. Under the scheme, the hospital is required to receive an emergency intimation number over the phone as pre-authorization from the third party administrator, who is responsible for processing claims. It can then start with the necessary procedure on receiving the approval, which is to be given within 24 hours.

Gnanapalani managed to meet the Chief Medical Officer (CMO) through an acquaintance. The CMO told him that the hospital, unlike many private hospitals, does not charge an extra rupee from scheme patients. However, there is a catch. The doctors sometimes use their discretion to identify who should get treated. Patients who look wealthy and ostensibly earn more than Rs 72,000 per year, which is the income ceiling for eligibility, form a good portion of the beneficiaries.

Abirama had already spent 10 days in the hospital under heavy medication. Her family was told that she’d have to wait her turn in the list and to leave. They had to shell out nearly Rs. 70,000 for the intensive care, stay and other expenses—and, obviously, the CMCHIS was not used.

Average reimbursement of treatment from 2012-2013 to 2015-2016 - by Government, Private and Total (INR)

Four days after the discharge, the family got a call from the hospital. Abirama, who had been writhing with chest pain when the effects of the medication wore off, had to be admitted again on January 2.

“They did a whole lot of tests all over again,” said Gnanapalani. “When I said we had done the same tests only a few days ago, they said that the doctor asked for the tests to be taken.”

However, Gnanapalani added that Abirama was well taken care of after this and that all expenses including food, stay and equipment amounting to Rs. 1,10,000 were covered under the scheme.

But the questions remain: Why did the empanelled hospital flip-flop on accepting the government health insurance? Why was the patient abruptly discharged? Why did they have to pay Rs. 70,000 while the CMCHIS is supposed to be a “cashless” scheme?

Why did it happen?

Researchers and medical experts say there are several explanations.

“There are hospitals that discourage patients under the scheme, because they have a good number of patients coming in even without it,” says Dr. Rajalakshmi Ramprakash, who recently completed her PhD research titled “Gender Analysis of Publicly Funded Health Insurance Schemes – A Study of Chief Minister’s Comprehensive Health Insurance of Tamil Nadu” at the Tata Institute of Social Sciences. 

The scheme currently covers 1,016 tertiary care procedures under 36 different specialities and 113 follow-up procedures, and has over 1.47 crore families in Tamil Nadu enrolled in it. The CMCHIS is generally considered a success as out-of-pocket expenditure has come down.

Dr. Rajalakshmi, whose study involved a survey of over 1,100 households and 4,400 individuals in slums in Chennai and Salem and interviews with 14 stakeholders, says there’s no one picture across the nearly 800 empanelled hospitals in Tamil Nadu.

“You cannot compare a 20-bed hospital with a 200-bed hospital,” she says. “There are a number of hospitals that actively seek patients under the scheme. These are usually small-sized hospitals, while the bigger ones do not depend on the scheme patients at all, as their regular patients would alone be sufficient. So, they try to discourage scheme patients.”

As for the hospital abruptly discharging Abirama, the explanation is that the procedure rates are fixed and are decided ex ante; hence, the hospital may not be able to get full reimbursement of the expenses incurred for Abirama’s fortnight’s stay and may have chosen to begin afresh. So, the family had to pay for her initial stay.

Lack of transparency

Abirama’s case is not a one-off affair.

At a public hearing at the Makkal Nalavazhvu Iyakkam, the state chapter of the People’s Health Movement of India, in September last year, a patient put forth his experience of the CMCHIS.

Ramalingam, a 65-year-old farmer from Madurai, suffered a cardiac arrest in October 2016. However, authorities of a hospital there refused to accept his CMCHIS card, and said that the family could either pay for treatment or go to another hospital. After taking loans, the family managed to pay nearly Rs.1.6 lakh.

Within the next five months, Ramalingam sent a complaint to the District Collector, the Deputy/Joint Director of Medical and Public Health Services and the Health Secretary of Tamil Nadu.

That was when he knew, through a response from the Joint/ Deputy Director of Medical and Public Health Services, Madurai, that the hospital in question had been suspended from the CMCHIS during the period from October 15, 2016 to January 19, 2017. However, at the time of his admission, a board at the hospital said that patients could avail themselves of the CMCHIS there.

This example flags the lack of transparency in the scheme. Hospitals suppress it when they get de-empanelled by the Empanelment and Disciplinary Committee. The CMCHIS website does not put out any notification of such action.

“De-empanelment happens if a hospital is found to be engaged in any fraudulent activities, or for low performance over a period of time or has conducted no health camp, for more than a year,” says a project evaluation report of the CMCHIS written by authors belonging to IIT Madras, the Public Health Foundation of India, the Population Foundation of India and Johns Hopkins Bloomberg School of Public Health.

The reason for the de-empanelment is not revealed in any publicly accessible medium. Even doctors and employees may not know the reason.

Dr. TS Selvavinayagam, Additional Director of Public Health & Preventive Medicine, says "they did not believe in naming and shaming” hospitals. Although the hospitals list is updated, notifications of such action are not available on the CMCHIS website.

Besides, punitive action against hospitals is usually very little. “They are suspended from the scheme for a few months,” says Dr. Selvavinayagam. “We can’t keep them out as we need more hospitals under the scheme.” He also said that on a daily basis, at least two warnings are given to hospitals involved in irregularities.

‘Doctors gain very little’

A Chennai-based consultant oncologist says private hospitals cut corners during procedures, as the package rates do not cover the entire cost.

“Sometimes, the cost of the operation theatre and technician charges is neglected under the compensation. In such cases, scheme patients are given treatment at odd hours during the night when not many technicians are around and surgeries are not usually scheduled.”

There is a huge disparity in the market prices and the prices fixed under the scheme, says the oncologist. “A 30-day chemotherapy treatment costing Rs. 75,000 or above has a meagre package rate of Rs. 45,000 under the scheme. A doctor earns only Rs. 500 per scheme patient, while she earns as much as Rs. 10,000 in other cases.”

The cost of cancer-related treatments like radiation usually ranges from Rs. 55,000 to Rs. 3.5 lakh, excluding medicines – which alone account for Rs. 5,000-1.5 lakh depending on the surgery. He says: “Moreover, our technological suggestions do not always align with that of the medical officers on the insurance desk, and they tend to deny the requests.”

According to the norms, payments to the hospitals have to be made within seven days. Nearly 20-25 per cent of the claims took more than 10 days to process from the first submission date in both government and private hospitals during 2014--2016, says the process evaluation report. After the final submission, however, 99 per cent of payments are made within seven days. “When the TPA asks for missing documents, then the clock starts all over again,” says Dr. Rajalakshmi.

Percentage distribution of claims by Turn-Around-Time (TAT) by type of facility - 2012-2013 to 2015-2016

Hospitals sometimes file dubious claims. Girish Rao, chairman and managing director of Vidal Health TPA Pvt Ltd., a third party administrator under the scheme, in a PowerPoint presentation available on the CMCHIS website, has highlighted several instances where private hospitals have misused the insurance scheme for profit.

The problem of cherry-picking of procedures also exists under the scheme. “Some procedures under the scheme are very profitable for the hospitals, so they encourage such patients,” says Dr. Rajalakshmi.

Many procedures including hysterectomy, hernia and appendicitis are exclusively reserved for government hospitals as there has been gross misuse of such procedures in private facilities.

The study, however says the incidence of misuse of the scheme is not known.

Ultimately, the patients bear the brunt. “The hospital’s insecurity in receiving payments from insurers, or any other problems are usually passed on to the patients,” she said.

Share of government and private hospitals in claims - 2012-2013 to 2015-2016

However, the satisfaction level of beneficiaries remains high, claims Dr Rajalakshmi.

“If someone gets treatment that costs Rs. 75,000, even if the insurance scheme covers only Rs. 30,000, they are happy. They don’t mind paying the rest,” said Dr. Rajalakshmi.

Dr. Rajalakshmi says that in a public-private insurance model like the CMCHIS, it is difficult to hold any one person accountable. She has an even more fundamental question. “If you have a CMCHIS card, the patient should be confident that she’ll be taken care of. Does this actually happen?”

All infographics courtesy: Process Evaluation Report of Chief Minister's Comprehensive Health Insurance Scheme, Tamil Nadu

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