NEW DELHI: The Delhi Medical Association has lodged a complaint with the Insurance Regulatory and Development Authority of India (IRDAI), accusing health insurers of fraud and alleging that a large share of collected premiums is being spent on commissions and administrative costs instead of patient care.
The association has also demanded that the Serious Fraud Investigation Office (SFIO) examine the matter.
In its submission, the Delhi Medical Association Nursing Home Forum (DMA NHF) said private insurers, acting collectively through the General Insurance Council (GIC), were indulging in cartelisation and abusing their dominant position in the health insurance market.
It urged IRDAI to investigate the role of the council, examine alleged anti-competitive practices, and direct corrective steps to ensure hospital tariffs are linked with inflation and patient rights are protected through uninterrupted cashless services.
The Forum said the GIC has introduced a “common empanelment” framework under which insurers jointly fix hospital tariffs and commercial terms. It argued that such a system has no legal basis and amounts to combined bargaining that undermines fair competition.
“With private insurers controlling over 50 per cent of India’s health insurance market, the insurers are misusing their dominant position to impose unilateral tariffs,” said Dr. VK Monga, chairman, DMA NHF.
“This so-called common empanelment strips hospitals of their right to negotiate independently, artificially suppresses tariffs, and threatens the sustainability of quality healthcare services. Instead of promoting competition and protecting patient interests, insurers are hiding behind IRDAI circulars to justify bargaining as a group. This misuse of regulatory directives undermines the Competition Act and IRDAI’s very own mandate,” he added.
The Forum further pointed out that hospitals are being compelled to continue providing cashless services under expired contracts at outdated and unviable rates, a practice it warned would inevitably lead to compromises in quality of care.