As a result of the pandemic, depression and mental health issues have become quite prevalent. Although most people tend to buy health insurance covers to avoid loosening their purse strings in the rare occasion of hospitalisation, there is a wide perception that medical insurance policies keep mental health-related illnesses out of their purview.
However, contrary to what one would like to perceive – mental health issues are also covered so long as they lead to hospitalisation.
Lack of awareness
For a long time, health insurance policies didn’t include mental illness in India – a trend which is undergoing a change.
“There is not much awareness about mental health policies amongst the public as of now. However, it is becoming important for both public and insurers as the number of such cases has risen sharply, especially after Covid,” says Naval Goel, Founder & CEO of PolicyX.com.
And even if there is an awareness, it may not be easy for a patient of mental health issues to get a medical insurance cover. Kapil Mehta, Co-founder and CEO of SecureNow Insurance elaborates on this.
“The main challenge is that persons suffering from mental illnesses do not get issued the health insurances in the first place. Once the insurance is issued, it is extremely comprehensive”, says Mr Mehta.
It is worth noting that there are two key exclusions in mental health cover. The first being the mental retardation and second, the mental illness due to abuse of drugs or alcohol.
Part of medical covers
The change of heart of insurers was not a fluke but a result of the insurance regulator's direction i.e., Insurance Regulatory and Development Authority of India (Irdai). The regulator told insurers to include mental illnesses to regular medical insurance policies via a circular.
The insurance regulator — in a circular issued on Aug 16, 2018 — directed insurance companies to comply with a provision of Mental Healthcare Act, 2017, which is reproduced below.
Sec 21(4) of the Act states, "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."
The regulator has told the companies that they should not deny medical cover to the policy holders who have a history of antidepressants.
It is imperative to note that even if the medical insurance policy covers mental health ailments, it may not still cover the cost of therapist or psychiatrist if the policy excludes the cost of outpatient department.
“There are few policies covering mental health, but, since therapist cost comes under OPD, it is not covered in these policies,” says Mr Goel.
Mr Mehta from SecureNow Insurance echoes the same sentiments. “There are no standalone mental health policies. However, all medical insurance policies cover hospitalisation costs of mental illnesses. Reimbursement of therapists is paid for in insurances that cover OPD,” he says.