# Kamesh Goyal on Why Co-pays Fail to Curb Rising Healthcare Costs Digit Insurance chairman advocates for transparent hospital pricing and simplified, modular insurance products. - **Source:** [mint - money](https://www.livemint.com/rss/money) - **Published:** 2026-10-29 - **Topic:** [Finance](https://brifing.si/c/finance) - **Original article:** - **On Brifing:** https://brifing.si/s/e00ce20a-18dd-4eca-8614-394bf9d52e68 ## The Co-pay Limitation Kamesh Goyal argues that shifting costs to consumers via co-payments does not address the root cause of rising healthcare expenses. Instead of curbing inflation, this approach merely transfers the financial burden to policyholders. Sustainable solutions require addressing opaque hospital billing practices and improving the overall efficiency of insurance distribution and operational processes. ## Standardizing Hospital Billing The current lack of standardized billing formats across hospitals complicates the claims process for both insurers and patients. Goyal emphasizes that clear rules regarding room eligibility and the financial impact of specific choices are essential. Without such transparency, the customer experience remains fragmented, leaving policyholders confused about their actual coverage boundaries. ## Simplifying Insurance Products Modern health insurance products are often cluttered with unnecessary features that make direct comparison difficult for retail customers. Goyal proposes a base health product model where additional benefits are offered as separately priced riders. This structure allows consumers to clearly understand the cost of their core protection versus optional add-on services. ## Predictable Premium Planning Insurers should disclose age-band structures and maximum potential premium increases at the time of purchase to help households plan effectively. Goyal suggests that premium revisions should be transparently split between the impact of aging and medical inflation. This clarity prevents sudden, unexplained price shocks that erode consumer trust in the industry. ## Risk Pooling Integrity Moving claim-free customers into newer, cheaper products while leaving claimants in older pools undermines the fundamental principle of risk pooling. This practice drives up premiums for the remaining group, creating a cycle of exits. Goyal advocates for no-claim bonuses instead of segregating customers, ensuring a more stable and equitable insurance pool. ## Operational Efficiency Targets With retail loss ratios typically between 65% and 75%, distribution and operating expenses represent a significant portion of total costs. Goyal suggests that reducing these expenses by five percentage points could provide tangible relief to customers. However, he warns that even maximum efficiency cannot offset healthcare inflation that far outpaces general economic indicators. ## Transparency in Savings Comparing insurance savings products is currently as complex as solving a puzzle, often requiring advanced AI to decipher benefit illustrations. Goyal calls for standardized, machine-readable formats that clearly show the internal rate of return. Such transparency would allow consumers to compare insurance products as easily as they currently compare fixed deposits. ## Regulatory Expense Caps Current expense limits may inadvertently penalize retail-focused insurers by forcing them to chase low-cost bulk business to meet caps. Goyal recommends weighted expense allowances based on business mix to level the playing field. This approach would prevent regulations from distorting product strategy while still encouraging insurers to maintain high operational efficiency. ## Future of Regulation Goyal supports moving toward principle-based regulation that includes clear guardrails rather than prescriptive commercial mandates. He emphasizes that if current data shows intended outcomes were not met, regulators must be willing to correct the course. A mature industry requires accountability and transparency to ensure that consumer protection remains the primary objective. ## Sources covering this story - https://www.livemint.com/money/personal-finance/kamesh-goyal-digit-insurance-health-insurance-co-payment-co-pay-healthcare-costs-insurance-premiums-hospital-pricing-11793203288259.html — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._