Opting For This Health Insurance Provision Can Help Ease Medical Costs

Amid rising health insurance premiums, opting for Preferred Provider Network rates can provide some reprieve in helping bring down medical costs.

The Public Provider Network rate is a discounted healthcare treatment rate that hospitals provide to the customers of insurance companies they have a tie-up with. When you receive treatment at a hospital within this network, the cost of your medical services is charged based on these pre-negotiated rates, leading to lower out-of-pocket expenses.

Opting for health insurance covers, where the insurance company is a part of a well established PPN network, can help the insured benefit from lower rates, according to Nikhil Jha, founder at Hercules Insurance Advisors.

The insured can also avail benefits such as ambulance cover, consumable cover, consultation fees discounts, lower deposit requirements and priority in treatment, he said. Consumers can benefit from checking for which hospitals an insurance company has partnered with in their vicinity, he added.

Currently, just about one-fifth of customers have insurance plans with access to PPN rates and this is largely restricted to metro cities where cost of hospitalisation is more, noted Siddharth Singhal, business head, health insurance at Policybazaar. Often, PPN is inbuilt too, he added.

According to PB partners, many insurance companies offer cashless treatment facilities at PPN hospitals, with the insurer directly settling the bill with the hospital based on the agreed-upon rates. PPN rates also ensure standardised pricing for specific procedures across hospitals, reducing variability in costs and ensuring fair pricing across different hospitals.

However, for most customers it's not a high priority when availing a health insurance given that it might not make as much of a difference in cost, said Surinder Bhagat, head of employee benefits and large account benefits at Prudent Insurance Brokers. The PPN network for public insurance companies—General Sector Public Insurance Association—is robust with a coverage of almost 3,200 hospitals under it, Bhagat said.

PPN network of private players is not as competitive and aggressive, with only some of the larger players being able to bring enough volumes and offer discounts.

• Verification: Always verify if the hospital is part of your insurer's PPN list before admission, explains a post by PB Partners. You need to be admitted to a PPN hospital belonging to the specified PPN network.

• Pre-approval: PPN rates only apply to specified procedures that are pre-approved by the agreement between the hospitals and the insurance company. Ensure that your medical procedure is covered.