Pricing policies should be updated in order to cover patients under all types of scenarios.
Until August of this year, health insurance policies did not cover mental illnesses. But then, the Insurance Regulatory and Development Authority of India (Irdai) asked insurance companies to make provisions to cover mental illness, in a circular dated 16 August. The circular was a step in the right direction as it increases the scope of health insurance coverage for a large section of the population. As per the National Mental Health Survey of India for FY16 conducted by the National Institute of Mental Health and Neuro Sciences, nearly 15% of Indian adults are in need of active intervention for one or more mental health issues and the WHO estimated 56 million people suffer from depression and 38 million from anxiety disorders in a report released earlier this year. According to the circular every insurer needs to make provisions for medical insurance for treatment of mental illness on the same basis as is available for treatment of physical illness and stated that insurers will need to comply with these provisions with immediate effect.
However, the circular only states that there should be no discrimination between the two illnesses, mental and physical. That doesn’t change anything for the insurers in terms of their underwriting decisions. Even now, the insurer can altogether deny health insurance to a person suffering from a physical illness, say cancer or heart disease, as per its underwriting norms. The same underwriting criteria would then have to apply to individuals with a pre-existing mental illness. To this effect, according to recommendations of a panel set up by Irdai, a list of 17 diseases, including chronic kidney disease, Hepatitis B, Alzheimer’s, epilepsy and HIV and AIDS, would be excludable from health insurance polices, but only if they are pre-existing. Although the present situation is better than a complete ban on coverage of mental health illnesses, in order to ensure adequate health insurance coverage, insurers should be able to price policies and premiums appropriately enough to enable them to cover all types of scenarios and situations when it comes to the health of individuals. Only then will the penetration of health insurance increase.