Vidal's Vipul acquisition—an insurance policy against TPA extinction

India’s third-party insurance administration market has been in the throes of an existential crisis for years. Consolidation is inevitable in the already tiny sector and Vidal Health wants to be the one holding the lever when the dust settles

On 9 March, Vidal Health acquired Vipul Medcorp to become one of three largest Third Party Administrators (TPAs) for health insurance in India

Already one of the key implementers of Ayushman Bharat, with this acquisition, Vidal has added corporate and individual health insurance business to its portfolio

A crucial cog in enabling access to healthcare, TPAs are struggling with low margins and shrinking opportunities for growth in India

Vidal, on the contrary, is one of the few TPAs hustling to expand in the Indian market and abroad in the hope of building a business that survives the crisis

Hospitals are a peculiar world, where life and death situations are starkly juxtaposed against the mundanity of billing and insurance. Result: no one really pays attention to what’s going on in between. Especially when there’s a nameless, faceless layer—the third party administrators (TPAs)—that quietly handles the legwork of processing insurance claims.

The segment is a vital cog in India’s sprawling healthcare setup. At Rs 14,952 crore ($2 billion), TPAs processed about two-thirds of the amount claimed by policyholders for the year ended March 2020, with private insurers processing the rest in-house.

AUTHOR

Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

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