Case Law Details
Dr. Supratik Sanatani Vs National Insurance Company Limited (Competition Commission of India)
It has also been alleged that OP-1 to OP-4 have induced a cartel of hospitals called PPN hospitals who compel the insured to sign a ‘PPN Network Declaration Form’ for providing cashless service. By signing this form, the insured is forced to accept that the four OPs would pay hospital expenses only as per the arbitrary ‘agreed packages’ by them with the hospitals and not according to the concerned policy terms and conditions, and thus, the insured has to pay the unpaid amount of hospital bill in excess of the PPN charges to the hospital. It has been averred that, by signing the declaration form, the insured forfeits his right to claim the unpaid amount of his hospital bill as reimbursement even when it is payable under the terms and conditions of the policy. It has been stated that hospitals which do not agree to get this form signed by the insured patients are kept out of the PPN hospitals, and such conduct of the four OPs amount to denial of market access as envisaged under Section 4(2)(c) of the Act. It has also been alleged that four OPs do not offer cashless service in all network hospitals of its TPAs but only in hospitals which agree to forcefully collect the PPN Declaration Form from the insured.
Commission notes that all four OPs appear to have negotiated special package rates with many hospitals across 12 cities for several medical procedures. Apparently, the purpose of the PPN tariff rates is to have standard packages and charges for certain medical procedures to save the insured from being charged more and for better utilisation of the insured amount. Policy holders can avail cashless facility in PPN hospitals approved/empanelled by GIPSA. PPN hospitals have to charge as per the PPN package rate. If any hospital overcharges, it appears that the policy holder can raise a grievance with the insurance company.
From a holistic perspective, the Commission is of the view that, though each insurance company is required to compete with each other (regardless of their being in private or public sector), the Opposite Parties (OP-1, OP-2, OP-3 and OP-4) in the present case (being public insurers) have sought to justify their conduct of coming together to negotiate with hospitals for having a PPN. This, according to them, helps lower the charges for various procedures undertaken by the hospital while providing treatment to the insured. The Commission notes that it has been stated, there is the advantage of standardisation of cost by having uniform costs payable to various hospitals by the insurance companies thereby ensuring settlement of claims of the insured without acrimony between the insurers and the hospitals. The Commission notes that the four Opposite Parties have contended that fixation of PPN tariff rates helps the insured/consumers in the form of lower costs payable to hospitals for various medical procedures undertaken, which ultimately translates to lower premium payable by such policy holders.
With regard to the submissions that PPN by the four OPs restricts the claim amount and is not commensurate with the value of the sum insured, the Commission is of the prima facie view that alleged violation of the terms and conditions contained in the insurance policy can be remedied under the appropriate law, especially when the concept of collective dominance of the OPs is alien to Indian competition law. Suffice it to say that any action which is not in consonance with the larger interests of consumers would lead to the shifting of allegiance to better service providers. The Commission observes that, consumers have the option to buy health insurance policies from alternative channels, should they want.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
