Impact Of Mental Illness Mandatory Coverage On Health Insurance Plans

The majority of basic health insurance providers do not cover you or your insured family members in case of any mental illnesses.

Shivani
Updated on: 2022-11-18T16:16:24+05:30
Impact Of Mental Illness Mandatory Coverage On Health Insurance Plans
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The majority of basic health insurance providers do not cover you or your insured family members in case of any mental illnesses. No matter whether the insured has a mental illness as a pre-existing disease or developed the condition after the policy purchase, treatment of any kind of mental illness is generally not payable by health insurance companies.

However, the decision by the Insurance Regulatory and Development Authority of India (IRDAI) to begin covering serious mental diseases as of October 31, 2022, will bring a paradigm shift in the health insurance sector. Not many insurance seekers and policyholders are cognizant of how this mandatory coverage will work. So, before understanding how it will impact new and old health insurance plans, let's have a brief overview of the act that is behind this mandatory coverage.

What Is Mental Healthcare Act 2017?

Since May 29, 2018, the Mental Healthcare Act of 2017 has been in effect. As per Section 21(4) of the Act, every health insurance must offer medical insurance for treating mental illness on par with that which is offered for treating physical illness.

In 2018, the IRDAI ordered Indian insurance providers to cover mental illnesses in accordance with the 2017 Mental Health Act. Despite this, insurers did not alter their practices or leave the mental illness component out of insurance coverage.

After the supreme court got involved and ordered everyone's insurance providers to start offering plans for mental illness by October 2020, the IRDAI was forced to act. Despite the two-year delay, it will now be put into practice.

What Will Change Due To Mental Illness Mandatory Coverage?

According to the WHO, 1 in 3 Indians suffers from depression. New regulations will guarantee that health insurance policies cover a sizable number of people who were previously outside the scope of coverage.

Here are a few changes that you may expect after the successful implementation of the act:

⮚ Type Of Diseases Being Covered

The new regulations will equalize mental and physical illnesses. This need for comprehensive insurance coverage that covers both physical and mental well-being is crucial given the heightened attention given to mental health issues in the wake of the pandemic.

Though the extent of the coverage varies depending on the insurer, bipolar affective disorder, schizophrenia, acute depression, panic disorders, post-traumatic stress disorder (PTSD), personality disorder (PD), attention deficit hyperactivity disorder (ADHD), eating disorders, and dissociative disorders are a few of the disorders whose treatment will be covered since they were not covered by basic health insurance plans earlier.

⮚ The Feature Will Extend To All Old Policies

Insurance companies can no longer simply deny applications from individuals with mental disorders for new policies. While new insurers can anticipate benefits from these modifications, old policies will also have this feature.

Customers who already have certain ailments may now purchase a policy. And if someone contracts certain diseases after purchasing coverage, a claim will be admissible in those circumstances as well.

Which Diseases Will Not Be Covered Under Mental Illness Mandatory Coverage?

Conditions associated with mental retardation will not be covered by the insurance as per the Mental Healthcare ACT of 2017. The act does not include it and defines it as "a condition of arrested or incomplete development of mind of a person, especially characterized by sub-normality of intelligence."

Will Insurance Cover A New-Born Baby With A Mental Illness?

The type of mental illness and the time will determine which mental illness in children is covered. This is a murky issue because the majority of the disorders in this group are linked to mental retardation and, in accordance with the Mental Health Act, are not required to be covered. As a result, most companies reject claims made under the coverage.

Conclusion

For a very long time, society, family, and friends have stigmatized and avoided people with mental illness. There have been plenty of discussions about problems with physical health, but few about the rising number of mental illnesses as a result of the stigma associated with them. However, the Mental Healthcare Act of 2017, which was put into effect in 2018, focuses on including mental illnesses for coverage under health insurance.

Insurance companies have been mandated to incorporate coverage for mental health in their health insurance plans by the Insurance Regulatory and Development Authority of India (IRDAI), which can provide tonnes of benefits to the policyholder.

Shivani

Shivani

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