Your medical insurance plan will now cover mental illness, similar to those offered for treatment of physical illness

The insurance regulator has directed insurance companies offering health insurance to cover treatment for mental illness.

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The insurance regulator has directed insurance companies offering health insurance to cover treatment for mental illness. The directive follows the Mental Healthcare Act, 2017 which came into force from May 29 this year making mandatory for insurers to offer medical insurance for mental illness treatments similar to the ones offered for treatment of physical illness. At present, insurance companies do not cover mental illnesses.

“As per Sec 21(4) of the Mental Healthcare Act, 2017 every insurer shall make provision for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness. All insurance companies are hereby directed to comply with the aforesaid provisions of the Mental Healthcare Act, 2017 with immediate effect,” the Insurance Regulatory and Development Authority of India’s (Irdai) circular to insurers said.

Growing burden
The National Mental Health Survey (NMHS) done by National Institute of Mental Health and Neurosciences (NIMHANS) in 2016 found that nearly 150 million Indians need mental health care services. Of this, less than 30 million are seeking care and the mental health systems assessment indicate not just a lack of public health strategy but also several under-performing components.

The survey highlights that nearly 15% of Indian adults are in need of active interventions for one or more mental health issues. “Common mental disorders, severe mental disorders and substance use problems coexist and the middle age working populations are affected most; while mental health problems among adolescents and elderly are of serious concern, urban metros are witnessing a growing burden of mental health problems,” it says.

No insurance cover
At present, health insurance providers offer individual and family coverage, primarily for physical ailments and the coverage includes hospitalisation or treatment at hospitals. In the absence of any insurance coverage for mental health disorders, most of the payments for treatment are out-of-pocket expenses.

After the regulator’s directive, insurance companies will have to include cover for mental illness. However, the premiums are likely to increase with the inclusion of mental illness such as depression and anxiety under insurance cover. Jyoti Punja, chief operating officer and customer officer, Cigna TTK Health Insurance Company, says insurance for mental health is a progressive step in the right direction and will ensure a life of dignity to those who have mental health issues.

Analysts say insurers will now have to make actuarial calculation to calculate the premium rates for mental disorders. Moreover, limits may be set on the total amount of coverage or claims for various treatments related to mental illness.
Earlier this year, Star Health Insurance launched medical insurance cover for children diagnosed with Autism disorder aged between three years and 25 years. The sum insured is for Rs 3 lakh and has sub-limits for ailments and treatments. The gross premium (excluding tax) for this policy in the age group of 3-10 years is Rs 4,800; for age group 11 to 20 it is Rs 5,325 and for those in the 21 to 25 years age group, the premium is Rs 6,075. The policy is renewable up to the insured person completing 25 years of age. Beyond 25 years, the company states in its brochure that coverage will be offered in suitable alternate product with continuity benefits for applicable waiting period.

On Irdai’s directive, S Prakash, chief operating officer of Star Health Insurance says the mental health insurance is a move in the right direction as this is one of the major steps that would ensure increased focus in this area. “It will help people suffering from such illness by bringing them at par with any other illness, thereby, offering them equality in every respect,” he says.

Insurers will now have to file fresh product application with the regulator for mental health coverage or add it to an existing product and revise rates accordingly.

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