Hospitals and clinics have seen a sharp spike in outpatient visits since late January. Insurance settlements have not been able to match up and that's causing problems across the sector. Image Credit: Gulf News Archive

Dubai: Hospital operators in the UAE are in talks with medical insurers to try and speed up the insurance claims generated since the start of the year. An early - or timely - release of funds is the only way healthcare facilities can manage the sharp spike in outpatient visits since early February.

This was after the first cases of coronavirus were detected in the country and led to a rush of people wanting to get themselves checked. Most of the leading hospitals and clinics report a high double-digit growth in outpatient visits during this period.

“The majority of the visits are to see GPs or internal medicine - so the per visit claims generated is not on the higher side,” said Dr. Sherbaz Bichu, CEO of Aster Hospitals UAE. “Typically, they range between Dh400-Dh500 - but the problem is the number of claims being generated and impacting on our “cash burn”.

“No one is coming to a super speciality hospital to treat a cough - everyone knows that, including insurers.

“This is why the healthcare industry needs medical insurers to speed up the claims processing and free up the cash. For most healthcare facilities in the country, what insurers pay represents 80-90 per cent of their cashflow.”

Other healthcare sources also make the same point, that at a time of a nation-wide healthcare urgency, insurers should not be “sitting” on claims. “These are not claims made for complex surgeries or in-patient treatment,” said the owner of a mid-sized clinic in Abu Dhabi. “In fact, since February, most healthcare facilities in the UAE would have seen a drop in the number of in-patient claims or for orthopaedic issues, general surgery, etc.

“The bulk of the claims being generated now are for health scans or paediatrics and average about Dh300-Dh500. They do not require intensive processing by insurers.”

No one is coming to a super speciality hospital to treat a cough - everyone knows that, including insurers

- Dr. Sherbaz Bichu of Aster Hospitals UAE

According to a senior official at Prime, its outpatient clinics received 18 per cent more patients from the second-half of January and in February.

90-day window

The average time taken by insurers to process claims and pay off the concerned hospital or clinic that provided the treatment is 90 days. But in the last two years, the payback period has been stretched to 120 days and more, with insurers poring over each claim to ensure there is no overcharging or “over-prescription”. Rejections too had shot up significantly during this period and hurting healthcare operators quite a bit.

But with the sudden rise in the numbers visiting hospitals for check-ups or treatment, hospitals are in dire need for cash. Waiting around for 90-120 days is no longer feasible, say operators, and especially for the smaller clinics.

Insurance industry sources, however, say there is no move to speed things up on the payments side. According to a top official at a leading insurance broker, “As far as I am aware there is no change in the payments protocol between insurers and healthcare providers. “Yes, there is a general hike in consultations since the coronavirus outbreak - but healthcare providers should have the funds to manage such increases and not be dependent on claims payout.”

And on what the “ideal” claims settlement should be, the insurer said: “This depends entirely on the agreement between individual healthcare providers and insurers.”

In other words, trying to enforce a uniform settlement period can be counter-productive.

Not convinced

Dr. Bichu feels healthcare providers will not be swayed by that argument. “We have to pay off suppliers in not more than three months - if that’s the typical payment cycle, why should healthcare providers have to wait four- to five months to have insurers pay what’s due.

“Everywhere there’s a cash crunch, it could get a lot worse before the situation improves. All that the insurers need to do is pay us back on time what’s due to us. Nothing more.”

The healthcare industry finds itself at the forefront of the fight against the COVID-19. Operators are taking emergency measures to cope with any situation... at the same time trying to make the best utilisation of their cash resources. Some have responded by allowing part of their staff - about 30 per cent - to proceed on two-week leave (which these days effectively means staying put at home here.)

“The reason is that this will allow us to have sufficient unexposed manpower during the crisis,” said a senior doctor at a hospital in Abu Dhabi. “We can then rotate in fresh staff every two weeks and thus be fully prepared to meet any healthcare service requirement.

“Crisis times require a different sort of thinking - but we still have salaries to pay and supplier bills to settle. Insurers need to be broad-minded at this moment in time.”

Stop abusing healthcare premiums
The problem with UAE’s medical premiums is that no limits have been set on who can take out the basic policy.
“Even those earning upwards of Dh10,000 a month are taking the basic Dh500 a year policy,” said Dr. Sherbaz Bichu of Aster Hospitals UAE. “This should not be the case - there should be criteria based on salary on what a resident can take out as medical cover.
“In the current environment, it’s proving a burden for insurers because utilisation rates of medical insurance is so high. That’s because most people are taking out the basic policies and have no issues in using it whenever they have the slightest problem.
“This has to change... insurers need to change.”