Last week private health insurance providers and healthcare providers locked horns to the dismay of clients. This was after the umbrella body of healthcare providers issued a statement suspending some health covers with immediate effect, prompting government agencies to step in to avert a crisis.
The main issue at hand was that private insurance companies had refused to pay medical bills amid concerns of fraud. Insurance companies say some medical examinations demanded by doctors are questionable. Insurance companies were instructed to process all the pending receipts and pay their arrears in four days.
“We are really burdened by delayed payments, some of our members have gone for five and six months without getting any payment, others 10 months, it had become too much so we had to act,” said Dr Mugenzi Dominique Savio, the president of the private hospitals association.
Fraud in claims is a major concern for many insurance companies globally as some patients and hospitals have been accused of colluding to make fictitious claims. This has seen insurance companies improve their systems to detect fraud if any.
But this crisis laid bare the underlying gaps in regulation of health insurance which is relatively complex. This is partly because the value of health insurance is rooted in the unpredictability of medical spending.
Hence, health insurance spreads the risks of health spending across many individuals by pooling risks and expenditures. However, the power imbalance in favour of the healthcare and insurance providers calls for effective regulation to protect consumers.
For instance, when a doctor recommends questionable tests/ investigations, the consumer/ client is unable to challenge them.
Likewise, a health insurance company currently has an upper hand in deciding what medical bills are paid or not.
Therefore, we need to strengthen regulation of the different stakeholders to ensure that there is mutual accountability by all stakeholders to protect consumers. And perhaps, more importantly, it is important to have effective regulation to prevent market failure.
The government needs to consider setting up a specialized agency to ensure effective regulation. Such an agency should be well resourced with competent personnel that can address a key issue price setting to ensure that prices are set fairly, that is not too high or too low and adjusted to attain broader health- related goals.
Setting the appropriate price not only ensures that the costs of delivering services are covered, but also provides incentives for health care providers.
Improving regulation and better policies will be a win-win for all parties involved — patients, hospitals and insurance companies — to ensure seamless service provision. This will ensure crackdown on fictitious claims that insurance companies say subject them to losses while some hospitals smile all the way to the bank.
It is upon the government to take these concerns seriously and begin the process of improving regulation for the benefit of all.