Hospitals will no longer be able to rip off Mediclaim policyholders by loading charges.

Under pressure from the insurance industry, hospitals have agreed to offer their services and treatment at uniform prices across similar medical set-ups.

This comes as a boon to consumers who have to shop for hospitals at a time of distress.

"About 1,700-1,800 hospitals across the country have voluntarily applied to be part of this wide network of hospitals, and have expressed interest to offer standardised charges in treatment and service," said General Insurers' Public Sector Association secretary S K Mahapatra.

"This is in the larger interest of the community as the existing network proves to be inadequate and unorganised to facilitate cashless treatment," he added.

Once hospitals agree to join this network on a voluntary basis, they cannot charge higher rates. The applications are currently being scrutinised by the National Centre of Quality Management, to set up a database of hospitals and their existing tariff structure.

"These findings will help NCQM recommend standard charges based on empirical data," Mahapatra said.

NCQM has been asked to identify benchmark perimeters in relation to infrastructure, charges and treatment.

Hospitals across the country would be classified depending upon their infrastructure, experience, competency, seniority of doctors, specialists, and technology.

The treatment rate structure for individual class of hospitals would then be decided.

The cost of a bypass surgery today varies from hospital to hospital, and the differential can be as much as 100 per cent.

Once a standard pricing is introduced, all hospitals in a particular group -- depending upon their facilities and location -- will have to charge similar rates to Mediclaim policyholders.

This rate will vary from an 'A' class hospital to a 'B' class hospital. The new system is expected to commence before the end of the year, said Mahapatra.

Differential cost of treatment from hospital to hospital in the same category causes administrative problems for insurance companies and third-party administrators following the introduction of cashless hospitalisation, said Mahapatra.

Uniformity in pricing will help contain costs within the insurance system and also bring about greater transparency among hospitals.

Today, once the hospital administration is aware of the patient being a Mediclaim holder, they tend to inflate treatment costs.

Hospitals are not governed by any regulations in terms of pricing and treatment charges.

This exercise of standardising charges is being led by the Gipsa and the five nodal TPAs (third party administrator) -- Paramount, TTK, Family Health Plan, Medicare and Medsave.

"We have invited the Association of Medical Consultants and association of hospitals to interact with us to build a secure network of medical facilities," said Mahapatra.