Denied insurance coverage due to mental health condition? Persevere

Underwriting standards vary, so another insurer might well accept your proposal

Even as Insurance Regulatory and Development Authority of India (IRDAI) has been issuing directives to insurers urging them to improve the coverage of mental ailments, much needs to be done in this regard.

Recently, the regulator took another step by constituting a committee that will come up with recommendations regarding how the coverage of mental ailments can be enhanced.

Inclusions and exclusions  

The Mental Health Care Act of 2017 defines mental illness as a disorder in an individual’s mood, cognition, memory, or perception that hampers judgment, behaviour or decision making.

According to IRDAI regulations, insurers must treat mental ailments on a par with physical ailments and cover them similarly.

In the case of patients who don’t have any pre-existing mental ailment, most common conditions are usually covered by their health insurance policies.

“Conditions such as anxiety, depression and psychosomatic disorders are covered by insurance based on underwriting evaluation,” says Madhumathi Ramakrishnan, senior vice-president, Star Health and Allied Insurance Company.   

A few conditions are excluded. “Mental retardation and conditions arising from the abuse of drugs or alcohol are not covered,” says Siddharth Singhal, business head, health insurance, Policybazaar.com.  

Earlier, many insurers would straightaway reject patients suffering from conditions such as depression or anxiety. “Now, many insurers offer their health insurance policies to people who already suffer from a mental health condition. However, they have to serve a waiting period for that condition,” says Singhal. During those two-four years when they are serving the waiting period, they are at least covered for any other ailment they may suffer.

Patients who have a severe condition may, however, find it difficult to get coverage. “Similar to other major illnesses, health insurance coverage for major psychoses, which tend to require recurrent hospitalisations, are evaluated on a case-to-case basis,” says Ramakrishnan.

According to Aditya Bagarka, head, strategy and innovation, Plum, “Corporate plans usually cover pre-existing diseases, both physical and mental, from Day One.”   

Lacuna in coverage

Most health insurance policies today only cover the cost of hospitalisation, and that too for more than 24 hours. “In the case of mental ailment, however, most of the expense is incurred on the recurring therapy sessions that happen on an outpatient department (OPD) basis, and on purchasing the medicines prescribed by the doctor. Since most policies only cover in-patient costs, mental health treatment may not get covered by most health insurance policies today,” says Bagarka.

What should you do?

Whether you are trying to cover physical or mental ailments, the first step is to buy adequate health insurance. “People living in a metro should have Rs 10 lakh worth of health insurance per family member. Those living in tier II or III cities may manage with a Rs 5 lakh cover,” says Singhal.

If you can afford the cost, then avoid policies with co-payment and sub-limits. Those who already have mental ailment must choose a policy with a shorter-waiting period.

Check the policy conditions carefully at the time of purchase to avoid unpleasant surprises later. “Be sure to choose a product which provides cover for mental illness,” says Ramakrishnan.

Singhal suggests buying a health insurance plan with an adequate OPD component. In this, the cost of therapy sessions, doctor’s consultation fee, and medication are taken care of.

Underwriting standards vary from one insurer to another. Some insurers have more stringent standards that may lead to the exclusion of more people having mental ailments.

Those having pre-existing conditions should not get disheartened if they get turned down by one insurer. Another insurer may well offer them coverage.

Finally, while purchasing the policy, disclose any health condition that you have with complete honesty, to avoid claim rejection later.

TIPS FOR GETTING MENTAL HEALTH COVERAGE

Buy policy with adequate OPD coverage so that you don’t have to pay for outpatient treatment of mental ailment from your own pocket

If you already have mental ailment, go for a policy with a shorter waiting period

If you have a pre-existing condition and one insurer turns you down, try another

Check policy conditions: avoid a policy that doesn’t cover mental ailment