New Insurance Rules Prompt Better Access To Modern-Day Treatments

Awareness around the importance of health insurance has grown rapidly over the last decade. The global coronavirus pandemic, which infected over 125 million people and killed over 2.75 million has also played a crucial role in changing people’s perceptions about the need for health insurance. That is the reason why health insurance occupied the top spot in 2020, becoming the most valuable segment for non-life insurers in terms of premiums collected.

75 Per Cent Indians Grossly Underinsured

However, despite the rise in awareness, and more and more people buying health insurance policies, it is also a sad truth that a majority of Indians are not adequately insured. This applies even to those who have some kind of health insurance policies, be it from their employer or bought by themselves. What this means is that a majority of policyholders in India have purchased a low sum insured health insurance policy, that would not be enough to cover medical costs in case of serious health emergencies. Moreover, if medical treatment required modern technologies such as robotic surgery or stem cell therapy, then such policyholders may not even be able to consider those options because of high costs.

The reason is perhaps that there is a false perception in India that a family-floater policy with Rs 5-10 lakh sum insured is enough to take care of the medical needs of a family. However, there have been several cases in which many have found themselves in situations where they have had to exhaust their lifetime savings on treatment, and even had to borrow money to cover treatment costs. Underinsurance is a serious problem as it not only gives the policyholders a false sense of security of being covered, but also leads to increased stress and sudden out-of-pocket expenditure.

Introduction Of Advanced Treatment

With the cost of treatment rising with each passing year, a health insurance policy with an assured sum of Rs 5-10 lakh may not be enough. Moreover, with advancement in science and technology, modern medical breakthroughs are now available to treat ailments which may not have been curable earlier. In addition, this trend is expected to continue with many more modern medical breakthroughs becoming available for individuals suffering from serious illnesses. However, this would also increase treatment costs, and hence a health policy to cover these increased expenses is necessary.

Last year, the Insurance Regulatory and Development Authority (IRDAI) issued new guidelines making a set of 12 modern therapies and technologies to be now covered in the new and existing health insurance plans. These 12 modern therapies and technologies include robotic-assisted surgeries, oral chemotherapy, immunotherapy, deep brain stimulation and even stem cell therapy. Robotic surgery and stem cell therapy, especially, are advanced technologies that hold a significant promise in the field of healthcare. Besides, there is an array of other inclusions, like coverage for diseases such as mental illness, obesity, Alzheimer’s and Parkinson’s.

High Cost Of Advanced Treatment

The good news is that now one will be able to go for these modern treatments without worrying about their costs, as the insurer will take care of the expenses. However, one must take note that a lower sum insured could be a handicap in a situation where the policyholder requires a modern therapy treatment. To give an example, a complex robotic surgery is likely to be nearly Rs 4 lakh costlier compared to a laparoscopic one. On an average, an abdominal robotic surgery alone costs around Rs 6 - 7 lakh while a cardiothoracic robotic surgery can cost up to Rs 8 - 10 lakh in India. If you need a stem cell therapy, it could cost up to Rs 20 - 25 lakh in India.

Also, as per available data on medical inflation, medical costs are expected to double in 9 - 10 years. Then add to that other expenses during the hospitalization, which can run into several lakhs. Then there are pre- and post-hospitalisation expenses. By opting for a lower sum assured, one actually excludes the possibility of availing the modern therapies and technologies that are available today, and those that would become available in future, to treat serious ailments.

1 Crore Health Cover – Game Changer

To make sure you can cover for such healthcare expenses, you should opt for Rs 1 crore health insurance plan that many insurers today offer at an affordable premium. Designed as a combination of a base plan coupled with a super top-up, such policies are available at a premium as low as Rs 10,000 per annum, if you lock them at a young age. Even at an older age, these policies are affordable, but you should not postpone your purchase any further. By opting for an Rs 1 crore cover, not only you ensure you can get the best treatment possible today, but also in future when the healthcare costs are higher. Moreover, some insurers also cover treatment across the world with their plan offering global coverage. A higher sum assured in such cases would also go a long way to ensure you never fall short of money when it comes to availing the best possible treatment.

The author is Head, HealthInsurance, Policybazaar.com

DISCLAIMER: Views expressed are the author's own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.