On 27 August, the insurance regulator issued a circular removing 10 ailments and medical procedures from the list of non-payable items under a health insurance policy. These include medical procedures and ailments like dental treatments that do not require hospitalisation, hormone replacement therapy, treatment for infertility, obesity, treatment of HIV and AIDS, aesthetic surgery and stem cell implantation or surgery. In an effort to standardise the list of non-payable items in health insurance, the regulator in 2016 had made a list of around 199 non-payable items. Insurers were given flexibility to include or exclude these items.

To keep the list focussed only on consumables and non-medical items, the Insurance Regulatory and Development Authority of India (Irdai) has removed medical procedures and ailments. But this does not mean insurers are now liable to insure these procedures. “The list of non-payable items primarily includes consumables and other non-medical items. So far this list also included medical procedures and ailments, so we have removed those from the list," said an Irdai official who didn’t want to be named. “Insurers will still have the freedom to exclude or include these procedures as per provisions of the law," the official added. 

From a customer standpoint nothing changes. “For customers, this circular has no impact because even as the medical procedures and ailments have been removed from the list, the regulator has not explicitly asked the insurers to include them. Insurers, therefore, still have the flexibility to exclude these items," said Puneet Sahni, head, product development, SBI General Insurance Co. Ltd.

While nothing changes for you, it may be a good time to understand the list of non-payable items in a health plan.

Non-payable items

The standardised list has about 199 items that are generally excluded from a health insurance policy. Of course, insurers are free to include some of the items from the list but they cannot add to the list of exclusions. These are expenses that are not payable by your policy. Items on this list range from consumables, non-medical items including toiletries, cosmetics, personal comfort or convenience items to certain elements of room charges and administrative charges. 

For instance, telephone, laundry or internet costs are not payable. Even medical items such as spectacles, contact lenses, hearing aids, adhesive bandage, crepe bandage, and gauze are not payable. In room-related costs, expenses on television, air conditioning, housekeeping and attendant costs are not payable if they are billed separately and are not part of the room costs.

Administrative costs like the admission kits, discharge procedure, entrance passes or visitor passes, and patient identification bands or name tags are not payable by your policy. These expenses can account for up to 10% of the total hospital bill that you have to pay from your pocket; so knowledge of what is not payable is important.

“Some ailments and procedures had crept into the list of non-payable or optionally covered items. The circular from Irdai has rectified it. The circular in no way deprives the insurer of their prerogative of either covering or excluding these ailments or procedures as per the product constructs which would reflect in the policy wordings," said Shreeraj Deshpande, head, heath insurance, Future Generali India Insurance Co. Ltd. 

Most health insurance plans exclude these medical conditions and procedures so you need to take a closer look at health insurance policy documents to understand ailments and conditions that are not covered by the policy.

But this circular has triggered some debate on exclusions. “Medical procedures like stem cell surgery or hormone replacement therapy were seen to be experimental in nature and were therefore excluded earlier. But now they are standard medical procedures in certain conditions," said Kapil Mehta, co-founder, SecureNow.in. “Given that we are moving towards more inclusive health insurance coverage through Ayushman Bharat, retail products should also move in that direction," he added.

While this circular doesn’t push the insurance industry to be more inclusive, the regulator has set up a committee to review exclusions in health insurance and make suggestions on how to make such policies more transparent and inclusive. The committee is expected to submit its report by next month.

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