Health Insurance - it's all in the Fine Print!

With the constant increasing prices of healthcare in our country, and with the increasing instance of diseases, health insurance today is a necessity. Health insurance provides people with a much-needed financial backup at times of medical emergencies. We had written about the need to balance your financial plan with medical inflation some time back. Health risks and uncertainties are a part of life. And when we take a health insurance policy, we look for health insurance policies that claim high claim settlement ratio, large number of network hospitals, operational ease of claim, an affordable premium etc, Read more. However, we generally do not read the fine print in the entire policy document. Simply put, the fine print is not easy to understand for laymen.

So, we decided to write on this topic to bring more clarity on some of the terms and clauses in the fine print of health insurance policies so that you will be able to take an informed decision before either buying a health insurance policy or going in for hospitalization.

1. Reasonable and Customary Charges

It means the charges for services or supplies, which are the standard charges for the specific provider and consistent with the prevailing charges in the geographical area for identical or similar services, considering the nature of the Illness / Injury involved.

Sinhasi View: All the health insurance policy covers medical expenses which are Reasonable and Customary Charges incurred towards medical treatment taken by the Insured Person during the Policy Period for an Illness, Injury or condition as described in the policy.

In simple words, all the expenses related to hospitalization & other services should be at par with other similar hospitals/ service providers (in an apple-to-apple comparison) in the same locality. If your chosen hospital charges a higher bill for a service/treatment, your insurer can compare it with other similar hospitals in that region and settle the claim with a lesser amount citing the Reasonable and Customary Charges clause.

However, since you may not be aware of the reasonable charges of the treatment by other service providers in the same geography, we suggest you look for a network hospital and go for cashless treatment to avoid unwanted hassles. Of course, that may not be possible if the hospitalization is an emergency,

2. Excluded Providers

The expenses incurred towards treatment in any Hospital or by any Medical Practitioner or any other provider specifically excluded by the insurer and disclosed in its website / notified to the Policyholders are not admissible. However, in case of life-threatening situations or following an Accident, expenses up to the stage of stabilization are payable but not the complete claim.

Sinhasi view: The above clause is a part of permanent exclusion in some health insurance policies which we have come across. Practically, it is unlikely that a customer would be aware of any hospitals which are excluded by the insurer. And during any hospitalization if the customer ends up being admitted in such a hospital, the claim may be declined and there may not be any reimbursement of any expenses incurred during the hospitalization.

Hence, it is highly suggested that prior to the admission, you should speak to your insurer on the tollfree number/ your insurance agent and get a clear communication about the hospital in which you are planning to be admitted.

Again, we would like to reiterate that unless the hospitalization is an emergency, you should always look for a network hospital and go for a cashless treatment to avoid unwanted hassles.

3. Rest Cure, Rehabilitation and Respite Care

Expenses related to any admission primarily for enforced bed rest and not for receiving treatment. This also includes

Custodial care either at home or in a nursing facility for personal care such as help with activities of daily living such as bathing, dressing, moving around either by skilled nurses or assistant or nonskilled persons.

Any services for people who are terminally ill to address physical, social, emotional, and spiritual needs.

Sinhasi View: God forbid, but if something happens to you and a private nurse is a must for your day-to-day activities during the hospitalization or at home, the expenses towards a private nurse may not be covered. You should keep this in mind before opting into a policy that eliminates these services so that you are mentally and financially well prepared.

4. Ancillary Hospital Charges

These are charges related to a hospital stay not expressly mentioned as being covered. This will include charges for admission, discharge, administration, RMO charges, night charges, registration, documentation, and filing surcharges and service charges levied by the Hospital etc.

Sinhasi View: Please note, the expenses which are mentioned above, are generally not covered in the base policy if not specifically mention the policy document. Also, we have examined many hospital bills and found that a large portion of the billed amount is not properly defined in the bill and are consolidated in a single heading of miscellaneous expenses. Such head of expenses are generally declined by the insurer during reimbursement. Our recommendation is to ask the hospital/service provider for a detailed bill in which these expenses are clearly defined.

5. Living Organ Donor

Following Expenses which are incurred during organ transplant are not covered in most of the health insurance policies.

• Pre-hospitalization or Post-hospitalization Medical Expenses of the organ donor.
• Screening or any other Medical Expenses related to the organ donor, which are not incurred during the duration of Insured Person's Hospitalization for organ transplant.
• Expenses related to organ transportation or preservation.
• Any other medical treatment or complication in respect of the donor, which is directly or indirectly consequence to harvesting.

Sinhasi view: Majority of the expenses which occurs during organ transplant are generally not covered in the health insurance policy. More precisely, expenses related to the donor are not covered. If you ever need to undergo an organ transplant, please check your policy details, and find out if the expenses incurred by the donor are covered so that you can be prepared with your finances accordingly.

Other Exclusions

1. Expenses related to Obesity/ Weight Control which is not advised by the doctor.
2. Expenses for cosmetic or plastic surgery or any treatment to change appearance unless for reconstruction following an Accident, Burn(s) or Cancer or as part of medically necessary treatment to remove a direct and immediate health risk to the insured.
3. Expenses related to any treatment necessitated due to participation as a professional in hazardous or adventure sports like para-jumping, rock climbing, mountaineering, rafting, motor racing, horse racing or scuba diving, hand gliding, sky diving, deep-sea diving etc.
4. Treatment for, alcoholism, drug or substance abuse or any addictive condition and consequences thereof.
5. Expenses related to the treatment for correction of eyesight due to refractive error less than 7.5 dioptres.
6. Conflict & Disaster - Treatment for any Injury or Illness resulting directly or indirectly from nuclear, radiological emissions, war, or war like situations (whether war is declared or not), rebellion (act of armed resistance to an established government or leader), acts of terrorism.
7. Treatment, procedures and preventive, diagnostic, restorative, cosmetic services related to disease, disorder and conditions related to natural teeth and gingiva except if required by an Insured Person while Hospitalized due to an Accident.

Hope for the Best and expect the worst

You should expect that your medical expenses are covered by your health insurance policy up to 70% - 80% and remaining will be deducted based on the T&C. Hence, you should be mentally prepared to pay 20% - 30% of the bill from your pocket. You should keep your expectation low, and if the claim gets settled with higher than the expectation, it’s great, isn’t it!

Disclaimer - the above details are based on our limited knowledge and experience, and we strongly suggest that you should go through the policy wordings/documents carefully to get a clear information about YOUR policy as the T&C and clauses may vary from policy to policy.

These views are solely for the purpose of bringing clarity and awareness on the technicalities and fine prints in health insurance policies in general and not specific to any product/policy. As an aside, did you know the health insurance policy can be tailormade for every family. And most people don’t know, but an entire policy can be designed around your needs.