The concept of TPA or the THIRD PARTY ADMINISTRATOR has been introduced by IRDA (Insurance Regulatory and Development Authority) for the benefit of both the insured and the insurer. While the insured is benefited by quicker & better service, insurers are benefited by reduction in their administrative costs, fraudulent claims and ultimately bringing down the claim ratios.
In brief, the job of the TPA is to maintain databases of policyholders and issue them identity cards with unique identification numbers and handle all the post policy issues including claim settlements. In terms of infrastructure, the TPA will need to run a 24-hour toll-free number, which can be accessed from anywhere in the country. And they will have full-time medical practitioners under their employment who will immediately take a decision on whether the ailment is covered under the policy.
The policyholder will have full freedom to choose the hospitals from the empanelled network and utilise the services as per their choice For every hospitalisation, the policyholder will be well aware whether the treatment is covered under his policy conditions or not. If covered, they can seek cashless facility at any of empanelled hospitals.
During the time of Emergency Hospitalisation, the policyholder or relative can flash the Photo ID-Card as a part of identification of the policyholder and gain admission into any of network hospitals. Treatment at hospital is given without payment at the time of admission as per the terms of the policy conditions. At the time of discharge, the insured will make payment which exceeds sum insured or the benifits not covered under policy conditions. A complete CASHLESS TREATMENT. Thus, the Individual does not run around for arranging cash for paying for the hospital expenses.