All about Inpatient Coverage in Health Insurance

1. All about Inpatient Coverage in Health Insurance

2. This might come as a surprise to many of us!  Prima facie it may seem that ‘Health Insurance’ would cover all their medical expenses. But, the truth is that most health insurance plans in India are majorly ‘hospitalization covers’. They cover expenses incurred during hospitalization and those related to hospitalization i.e. pre-hospitalization, post-hospitalization, etc. Plus, every health insurance policy comes with its own list of terms and conditions that one must be aware of in order to avoid any further surprises at the time of a claim. In this article, we’ll learn about a basic cover of health insurance - that is, coverage for Inpatient Care expenses. What is Inpatient Care? Inpatient care is the healthcare provided when you get admitted to a hospital. In order for inpatient expenses to be covered by health insurance, the duration of hospital stay should be more than 24 hours. Unless covered under Day-care procedures), any treatment requiring less than a 24-hour stay at the hospital isn’t paid for by health insurance. Here are the exact policy wordings taken from a health insurance policy document:

3. “We will indemnify the Medical Expenses incurred for one or more of the following due to the Insured Person’s Hospitalization during the Policy Period following an Illness or Injury.” Let’s try to break this down so that we can understand better. The first BIG word you see is ‘Indemnify’. Now, what does that mean?  In fixed benefit insurance products like critical illness insurance and term insurance, regardless of the expenses incurred/quantum of financial loss, your family is paid a sum assured upon the occurrence of the insured event like a diagnosis of a listed illness or death of the insured person. In health insurance, however, the insurance company will only compensate for the exact expenses you incurred (as long as it is lesser than the sum insured you have). So, even if you have a policy of INR 20 lakhs, if your hospital bill is INR 10 lakhs, the insurer will only pay INR 10 lakhs.  In case the expenses exceed this sum insured, you will have to pay the additional costs out of your pocket. For example, if you have a policy of INR 5 lakhs and the expenses are INR 10 lakhs - the insurer will only pay INR 5 lakhs and the remaining INR 5 lakhs - you will have to pay out of your pocket.  (Please note that - We’re simplifying this for the sake of this explanation. Usually, there will be cuts and deductions based on additional terms and conditions in the policy - but the maximum claim that’ll be paid will not be beyond the sum insured)

4. Key takeaways Health insurance only covers pre-hospitalization, hospitalization, and post-hospitalization expenses. Inpatient care is the healthcare provided when you get admitted to a hospital to undergo a medically necessary treatment that is advised in writing by a medical practitioner. For inpatient expenses to be covered by health insurance, the duration of hospital stay should be more than 24 hours.   In critical illness & term insurance, regardless of the expenses incurred, your family is paid a fixed sum if you get diagnosed with a listed illness or pass away during the policy term.  Health insurance, however, is an indemnity-based policy and hence, the insurer will only compensate for the exact expenses incurred. For the insurer to pay for the hospitalization expenses, there are 3 conditions that need to be met - the hospitalization should - involve an active treatment, be medically necessary, and be prescribed by a medical practitioner in writing.  Room rent charges, room boarding & nursing charges, fees of medical professionals, costs of medicines & drugs, ICU costs, operation theatre charges, costs of implanted devices are some costs that are a part of inpatient expenses.