MEDICLAIM: CLAIMS AND DISCLAIMERS

The controller and auditor General of India [CAG] had pointed out in a recent report that private hospitals were charging higher rates from patients with mediclaim policies compared to those who did not have any health insurance cover for the same treatment.

 

In an interview with Mail Today, a senior doctor at the All India institute of medical sciences (AIIMS) said that the huge charges of private hospitals, especially for those having a health insurance cover has contributed to the adverse claim ratio of insurance companies and consequently increases in premiums.

 

On case of Government employees, it is also true that despite passing on a part of the cost to the employers by way of monthly deduction under the head, the cost of health care is largely borne by the employees.

 

The tie-up of Pharmacies and Doctors

A large quantum of income to the hospitals usually comes from inpatients who are sold medicines at MRP at a very high profit margin whereas the same medicines are available at 100-400% less outside. But indoor patients are not allowed to get drugs or consumables from outside.

 

A study of medical trade practices in Mumbai sponsored by World Health Organization reveals the unethical and illegal trade practices of doctors and drug companies. Pharmaceutical companies sponsor Continuous Medical Education [CME] camps, where they develop personal bonds with the doctors, which they further strengthen with sponsored cocktail parties and then overseas trips. The net result of such favour ultimately burdens the patients admitted in the hospitals who are prescribed drugs from specific companies that may be much costlier than other brands available outside.

 

Recently insurance companies short listed some of the hospitals from their panel and objected to their prescribing a number of laboratory tests, and recommending costly treatments and operations which insurance companies thought could be avoided. Subsequently insurance companies stopped cashless facilities in some of these private hospitals. But there was sharp retaliation to such move, and courts through various judgments warned the insurance companies not to step into the shoe of doctors.

 

The Court Verdict

As per the courts, it is the doctors who decide what treatment is required to be given. Once the insured has paid the agreed amount of premium, insurance company is bound to meet the expenses. While deciding a Case of mediclaim in the matter of Shamim Khan V New India insurance company, Maharashtra State Consumer Dispute Redressed Commission has shown insurance firms their place, directing that it is the doctor and not the insurer who can decide whether a case requires emergency medical attention or not. It is further stated that “insurance company’s officers are not experts who can decide whether a particular case is of medical emergency or not.”

 

In the above mentioned case, Shamim Khan, the plaintiff who was working as a school teacher in Saudi Arabia suffered unbearable stomach pain when he visited India in July 2000, which led to severe bleeding. Khan was admitted to Bombay hospital where emergency surgery was conducted. Claim for total expenditure of Rs 41,158 was rejected on the plea that there was no emergency to undergo operation. Doctor’s certificate was then produced to prove the emergency in the case.

 

Apart from directing the claim of the consumer to be paid, court also fined the insurer Rs 5000 for rejecting the claim. The order came at a time when insurance companies are desperately trying to avoid passing claims and reimbursing expenses, borne by the insured under mediclaim policies. It is surely a big relief to the consumers at this juncture.

 

Complicated Language used in policy

Not only this, insurance companies use tricky language and defeat the purpose of policy. It is often found that claim is repudiated on the ground of pre-existing disease stating it as excluded diseases. In the case of Harjot Kour V National Insurance Company 2010 CTJ 168, Apex National Commission allowed the mediclaim of the complainant for operation during the first year of the policy as there was no evidence about the awareness of the patient about the symptoms of the disease or having got treatment for the same. Most of the people are totally unaware of the symptoms of the disease they suffer till it is diagnosed and some medicines referred to be taken. Under such situations, they cannot be held liable as held by Supreme Court in number of cases earlier also.

 

The insurance companies are repudiating even genuine mediclaims taking advantage of their exclusion clause. In yet another recent case Insurance Company V Anand Gourana reported in CTJ 2010 New India the Madhya Pradesh State Commission rejected the plea of insurance company that the charges incurred at hospital or nursing home primarily for diagnosis, X-ray or laboratory examination are not reimbursable.

 

Some companies started enhancing their premium amount for senior citizens with a view that after certain age, their medical expenses do increase. But now this controversy is also settled and IRDA on 6th January2011 has asked insurance companies to refrain from charging policy holders the premium amount which is outside the range filed with IRDA.

 

 

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