Govt Clarifies on Group Medical Insurance Scheme  

SRINAGAR — Dispelling the qualms being created through social media about the robust Group Medical Insurance Scheme rolled out recently, the State Government today made it clear that the scheme is immensely advantageous for the employees across-the-board.

 “Ironically, the disingenuous information being dished out about the scheme seems to be aimed at creating doubts in the minds of the employees and cross sections of the society, about the vastly beneficial advantages of the cashless healthcare initiative,” said a state government spokesman.

He said the scheme has been rolled out after following all required procedures in a fair and transparent manner. “The entire bidding process has been done in a competitive, clean and transparent manner in line with all Financial Rules and Regulations as well as CVC guidelines,” he said.

Regarding the numbers quoted that Rs1200 crore premium will be paid to the successful bidder, the spokesman clarified that only 3.5 lakh regular employees of the Government are expected to be covered under the scheme. “For all pensioners, All India Service Officers, Daily Wagers/Casual Labourers and those government employees who are already covered under a Health Insurance Scheme on their own, the scheme will be optional,” he said and added that the expected outgo of the premium would be approximately Rs310 crore per annum.

Giving details, the spokesman said it is important to point out that more than four years ago when ICICI Lombard was awarded the contract, the premium wasRs6196 per annum. “However, coverage was much less than this time and was previously restricted to Gazetted employees only,” he said and added that although the earlier policy also covered employee plus 5 members of his family, the coverage was only for a sum up to Rs 5 lakh and between the age group of 3 months to 80 years.

He said the fresh scheme approved by the State Government for all employees, covers the employee plus 5 members of the family including newborn babies and aged parents within the age group of zero to 100 years and that too for a coverage of Rs6lakh with a premium of Rs8877 per annum

The spokesman said that on any criteria of coverage, number of hospitals where cashless service will be provided (more than 4700 hospitals across the country) and the prevalent market rates, the premium quoted by the successful bidder is extremely competitive and low. “It is also known that at the premium of Rs6196 five years back the then Company suffered losses, as the total amount paid out by them for treatment was higher than the premium collected,” he said and added that ICICI Lombard with whom the State Government had its last contract has quoted Rs17691.74 premium per annum under the fresh scheme.

The spokesman said that the entire bidding process was monitored by a team of senior-most officers, well versed with the Financial Rules and Regulations, conducted through a technical and financial evaluation. “When the first round of bidding was conducted, only one bid was submitted by a Public Sector Undertaking. In a nutshell, the first round of bidding concluded with poor response and, therefore, had to be terminated,” he said and added that thereafter, a pre-bid conference was organized where both private and PSU companies participated and the tender was reissued with minor changes in technical parameters on their suggestion.

The spokesman said that all PSUs as well as top private insurance companies were contacted to participate in the bidding process as a result of which in the second round, 9 Private and Public Sector Undertakings submitted their bids, out of which 5 qualified on technical evaluation criteria. The financial bid of 5 qualified companies were opened and the it emerged that Reliance General Insurance Company with a quoted premium of Rs8776.84 was at L1, National Insurance Company Ltd with quoted premium of Rs11918.00 at L2, ICICI Lombard with quoted premium of Rs17691.74 at L3, Bajaj Allianz with quoted premium of Rs23476.10 at L4 and United India Assurance Company with quoted premium of Rs27225.00 at L5.

The spokesman said that the only PSU which participated in the first round and the bid of which was not opened due to poor response came second in the second round with a substantially higher premium quoted than L1.  “Further, the gap between L1 and other bidders was substantial and, therefore, there was no question of lack of competition,” he said.

The spokesman maintained that considering that OPD, as well as surgical and other interventions, are covered under the scheme, it was thought logical to discontinue the medical allowance of Rs3600 annually being given to the employees keeping in view the huge benefit of the fresh scheme. “This has no consequence monetarily as even if the Government continues medical allowances then the employees will have to pay Rs8877 as the premium while on discontinuance of medical allowances they are required to pay only Rs5277 as the premium. “Therefore, this decision has no consequence so far as bidding process is concerned,” he said.

The spokesman also clarified that considering the large number of employees to be covered under the Scheme and Insurance Sector itself a complex matter, the settlement of claims and redressal of grievance was an extremely important issue. Therefore, services of a consultant were hired for support through the bidding process and also to act as the interface between the Government and the successful company to ensure settlement of cases in a timely manner through an effective grievance redressal mechanism. At the time, when the insurance was only for 20000 people, there used to be 15 to 20 complaints to be settled at any given point of time. If the insurance is to be provided to a minimum 3.5 lakh estimated people there was a requirement of robust third-party Grievance Redressal mechanism. The Consultant will have Grievance Redressal Centres in all the 22 District Headquarters besides at the Civil Secretariat. However, the consultant will not charge anything from the Government for its services provided and the same will be borne by the successful company.

The spokesman also expressed dismay that the mention of the highest office of the State has been made in a factually incorrect and cavalier manner. “At no stage, the office of the then Governor stopped the bidding process. Instead, after the bidding process was concluded and having obtained the required approvals from the Finance Department and the concerned Advisor, the file was submitted to seek approval of the then Governor for submission to the SAC, which was approved by the then Governor,” he said and added that at each stage of the tendering process, the relevant competent authorities have approved the entire process which has been conducted in a transparent and professional manner.

The spokesman said that the Group Medical Insurance Scheme with a very reasonable premium alongwith the coverage it provides, number of hospitals including all top hospitals of the country being empaneled, shall be extremely beneficial for the employees and the misleading information being spread is only aimed at creating doubts in the minds of the people.  

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