News Middle East18 Aug 2019

UAE:Almost all health insurers outsource services to TPAs

18 Aug 2019

About 98% of health insurance companies in the UAE outsource their policies to a Third Party Administrator (TPA), according to Dr Saif Al Jaibeji,co-founder and chairman of Sehteq, which operates a technology driven platform that allows consumers to choose their health insurance plans.

In a recent article in the magazine Premium, he wrote, “Among the 23 TPAs in Dubai, seven companies control the majority of the business, by about 90%. One TPA administers half of that majority business, while 16 TPAs compete with each other for the remaining 10% or so.“

He said that such a market with a large number of players leads to unhealthy price war and unstable service levels. This is the root cause of the lack of innovation in this market.

The end user, or the insured member, cannot really differentiate due to too many players. There is limited interaction with the payer and in many cases, the member assumes that the TPA is the insurance provider. Again, this results in more price-driven choices and not service offerings.

 

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