GIC, IRDAI push for healthcare regulator amid surge in costs and uneven billing practices
New Delhi: India’s insurance and regulatory bodies are in discussions with the Centre to create a dedicated authority to oversee the healthcare sector, according to Ramaswamy Narayanan, Chairman and Managing Director of General Insurance Corporation of India.
The move, led by the General Insurance Council (GIC) in collaboration with the Insurance Regulatory and Development Authority of India (IRDAI), comes in response to widespread concerns over inconsistent hospital pricing and alleged misuse of health insurance frameworks.
“There is a need for a structure similar to what the insurance, banking, or stock market sectors have,” Narayanan said, referring to regulators like IRDAI, RBI, and SEBI. He noted that the current healthcare system lacks uniform pricing and oversight, leading to growing issues for both insurers and patients.
He raised concerns about how hospitals treat insured individuals. “When someone enters a hospital, their insurance status often dictates how they are charged. Rates can rise steeply just because a person has coverage,” he said.
Citing examples of hospitals billing insured patients significantly more than others, Narayanan said this practice affects claim ratios and contributes to rising policy costs. “Over time, the consumer bears the brunt through increased premiums,” he added.
A recent National Health Authority (NHA) analysis under the Ayushman Bharat initiative highlighted similar trends, pointing out that hospitals routinely charged insured patients two to three times more for identical treatments.
Aon’s 2025 Global Medical Trend Rates Report reflected the impact on the insurance industry, recording a 30% rise in claim volumes over three years, largely attributed to inflated medical billing for covered patients.
The financial pressure on households is also growing. The ACKO Health Insurance Index 2024 reported that medical inflation in India is now around 14% annually — more than double the country’s general inflation rate. As healthcare becomes more expensive, many families are being forced to borrow money to meet treatment costs.
Narayanan said the proposed health regulator would aim to introduce transparency in pricing and establish safeguards to prevent such disparities.
