Health Insurance is a contract between Insurance Company and Insured where Insurance Company promises to pay claim in case of any medical treatment through hospitalization. This is called Proposal and acceptance contract because Insured fills up a Proposal form and gives all details as asked in Proposal form and Insurance Company accepts/rejects/give counter offer on the basis of filled Proposal Form. So basis of the contract is the Proposal Form. Insurance Company also issues a Policy document which has all terms and conditions under which claim will be payable. Insurance Company also provides 15 days period in which Insured should read terms and conditions. In case Insured is not satisfied with terms and conditions then Insured has a 15 days freelook period under which Insured can ask for Policy cancellation with full refund.
5 Common reasons why Health Insurance claims get rejected
Given below are reasons due to which claims get rejected and how such incidents can be prevented by customers:
- Hospitalization not required: Rakesh was having a stomach ache. In middle of night when his pain was unbearable, his family took him to hospital and he was admitted for further investigations in morning. Rakesh did not mind admissions because he was insured. In morning, all tests were done and pain also subsided due to medication. He was discharged after one day. Rakesh claim was rejected because discharge paper did not mention any disease but he was billed for Rs 30000 due to all tests. In this case, insurance company is right because Rakesh used insurance for medical investigation and not treatment. However, there are cases when medical emergency happened and insured has to be admitted for treatment. In such cases, initial admission papers and then further treatment plays a very important role. It is the duty of insured not to use insurance cover as privilege but use insurance as facility for medical treatment.
- Standard Treatment Protocol was not followed: Sunita, age 50, had respiratory problem and was confirmed positive in RTPCR. Her doctor advised admission because her oxygen level dropped below 92. She was admitted in Hospital for 5 days till her RTPCR came negative. She spent over Rs 50000 in treatment but Insurance Company rejected claim because standard treatment protocol was not followed. Sunita objected with Case papers and daily record which showed regular Doctor visit and maintenance of recovery chart. On submission of doctor report and daily record, her claim was approved. It is necessary that Hospital maintains regular chart of vitals and a medicine course linked to chart.
- Non-Disclosure of pre-existing disease: Ravi, age 50, was admitted in hospital due to high BP and fainting while working. Office colleagues brought him to Hospital. While explaining to doctor, they said that he use to under stress and tension for last three years. Attending Doctor made a noting that known case of HTN for 3 years. Insurance Company rejected the claim on grounds that history of HTN was not declared. Later Ravi and family denied that Ravi has never been diagnosed with HTN and he has never taken any medication. Non disclosure is one of the frequent reasons of claim rejection and always remain a sore point. It is difficult for insured to prove that there was no non disclosure whereas Insurance Company has documents like Discharge and Admission paper where it is written “Known case of / KCO “. It can be assumed that there will be 50% probability that insured has deliberately not declared or advisor advised not to declare. But there is a 50% probability that insured had no knowledge and case has been misinterpreted on the basis of doctor noting on admission sheet. In many cases, patient inform symptoms and attending Doctors take it as diagnosis. Ravi may have Hypertension which he was carrying for over 10 years but he was diagnosed when it caused High BP. In such cases, it is difficult to argue but a certificate from Family Doctor or clarification from Medical Superintendent or leave record of employer help. (Insurance Samadhan advise that it is better to undertake a full body check up at the time of initiating any medical insurance. This would always work as evidence that there was no deliberate non-disclosure. Insurance Samadhan also recommend that all pre-existing diseases should be disclosed along with medical report.
- Poor Documentations: Many times, case get rejected due to poor or incomplete documentations. It is important that all fields are properly filled and all Hospital papers are duly signed and attested by Hospital. As all papers are scanned and seen on screen hence it is important that full document is scanned and should be legible. Many times scanned documents are not complete and not carry a serial number. Please note that your claim is checked as per full information given and incomplete information would lead to rejection.
- Terms and conditions: Many claims are rejected as per terms and conditions given in the Policy document like:
- Waiting period of 30 days
- Waiting period of specified diseases and pre existing diseases
- Exclusions as per list given in Policy documents
- Time period of information which is 48 hours of admission
- Time period of document submission which is 60 to 90 days maximum.
- Admission in Black listed hospital
- Room rent capping
Business of Health insurance Companies work on large numbers which is possible only if they settle maximum claims. Hence trust that Insurance companies take all proactive steps to settle claim if all declarations on age / occupation / Pre-existing disease have been made and treatment is taken where ever necessary.
In case of any genuine problem, you can always approach Insurance Samadhan.