Limited uptake hobbles ambition for India's National Health Claims Exchange

People close to the matter said insurers are largely in testing mode, evaluating the cost benefits and operational readiness of the standardised claims infrastructure before committing to full-scale migration.

Regulatory scrutiny intensifies

Sources said the Finance Ministry and IRDAI are considering tighter supervision of NHCX to curb overcharging by hospitals, ensure standardized claim settlements, and strengthen insurer bargaining power.

The move is seen as part of a broader push by regulators to make the platform a central tool for controlling rising healthcare costs and improving transparency in the cashless claims ecosystem.

Some insurers, on the condition of anonymity, told Moneycontrol that standardised rates, coupled with real-time access to claim data via NHCX, could allow them to identify inconsistencies in billing, flag inflated claims, and negotiate treatment costs more effectively.

By bringing greater oversight and standardized data into the claims process, regulators hope to reduce disputes, shorten settlement timelines, and ultimately make the platform a reliable backbone for the country’s health insurance sector.

Early adopters show potential

On the efficiency front, early adopters have demonstrated the platform’s promise. Star Health Insurance processed over 100 claim transactions through NHCX by mid‑2024, making it one of the first insurers to scale meaningful volume. In a September 2024 filing, the company said these transactions were completed within days once integration was live, highlighting how automation can accelerate claim processing.

According to the National Health Authority (NHA), for FY 2023‑24 nearly 3.26 crore health insurance claims were handled by insurers, of which 2.69 crore were settled, giving a settlement rate of about 82.5 percent.

The average claim paid was Rs 31,086, and cashless claims accounted for Rs 55,235 crore, representing 66.17 percent of the total claim amount.

Challenges in adoption

Despite growing onboarding, deep-seated frictions persist.

People familiar with the matter said hospitals, particularly smaller and mid-sized facilities, face significant hurdles in adopting NHCX, including high integration costs, limited IT infrastructure, and a shortage of trained staff to handle digital claim processes.

Many hospitals also worry about the operational disruption that a new system could cause, especially when existing portal-based workflows are still functioning, sources said.

Meanwhile, sources added, insurers are proceeding cautiously, relying on pilot projects rather than fully migrating their claims operations to NHCX. This approach allows them to test the platform’s reliability, evaluate costs and potential savings, and ensure that any transition will not interrupt ongoing claim settlements or affect their cash flows, reflecting a broader hesitancy to overhaul legacy systems without a clear business case.

A telling signal of limited scale is that no hospital had fully completed live claim flows as of late 2024, according to an Insurance Institute of India newsletter.

The newsletter emphasised that while TPAs have joined, the platform’s real value will only materialize when hospitals actively process live claims through the digital pipeline.

Meanwhile, while NHCX promises auditability and machine-readable data, questions also persist about data ownership, access control, and secure handling of patient-level information, according to sources.