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Economist Priya Desai analyses IRDA's plan to clean up health insurance
Minal is curious about why her 62 year-old husband Himanshu is so engrossed and happy reading the newspaper, sipping his tea in the morning. As she looks over his shoulder at the news, she too is elated that they can look forward to getting a mediclaim policy. The news relates to the release of draft guidelines by the Insurance Regulatory and Development Authority (IRDA), which kindles hopes for an improved healthcare environment. Senior citizens are beneficiaries as well. Being held in low esteem, even spurned by insurance companies as resource guzzlers, many silvers like Himanshu and Minal have been treated like outliers. As ballooning medical expenses wipe out their scanty savings, a feeling of despondency overwhelms them. No longer, as there is now a ray of hope.
The Bombay High Court recently ordered IRDA to frame guidelines for the health insurance sector. The mover behind these guidelines was Gaurang Damani, a social activist who filed public interest litigation (PIL) in this regard.
What makes seniors smile?
Let us look at some favourable features.
Eligibility age increased to 65 years. Co-payment to cover pre-insurance check-up expenses is likely. This is a big change in the treatment meted out to seniors, as insurers often avoided even people in their 50s. Widening the eligibility scope will bring relief to a growing number of seniors who have the ability to pay a premium but still remain outside the health insurance net.
No age of exit if a mediclaim policy is renewed year after year without any break.
A 30-day deadline for claim settlement after submitting the docu-ments and its inclusion in the policy document itself. Seniors like this author have felt financially abused when insurers have done away with cashless facility (public-sector institutions are big culprits here), followed by pronounced delays (sometimes running into months) in reimbursing claims. To rectify the situation, some enterprising elderly clients feel compelled to follow up with the company, insurance agents and Third Party Agents (TPAs). This process of chase-the-devil-who-has-my-money exacts a severe cost: unwieldy telephone bills, months worth of time and psychological stress. All this could well be history now.
No undue loading of policies and arbitrary fixing of premiums at renewal. New guidelines compel insurers to be accountable. If an individual's claims in each of the three consecutive policy years (except the current one) exceed 500 per cent of the current premium, the insurer can hike the premium according to the predetermined table disclosed at the time of issuing the policy. IRDA would need to be convinced if premiums are to be hiked.