Insurance firms are tweaking rules to help cover the expense on consumables via riders, to be bought along with the base plan
Over the last 18 months, medical expenses of in-patients with COVID-19 infection in India have risen to unprecedented levels. This has resulted in tremendous financial pressure on families of those infected by the deadly coronavirus, forcing them to borrow money from family and friends to pay the hospital bills.
Detailed analyses of hospital bills show that the rise is majorly due to consumables that include PPE kits, syringes and sanitisation products. Consumables refer to single-use items used for medical treatment or procedures.
During pre-COVID-19 times, the average cost of treatment at a private hospital was between ₹50,000 and ₹60,000. However, during the COVID-19 phase, this has increased to ₹80,000-90,000.
The cost of consumables in hospital bills has significantly gone up since the outbreak of pandemic. Today, the per-day, per-patient cost of hospitalisation for COVID-19 treatment is ₹10,000, and for a 15-day hospitalisation, the cost comes around anywhere between ₹1.5 lakh and ₹2 lakh.
During hospitalisation due to COVID-19, consumables make for one-fourth of the bill and if the stay extends for a longer period due to co-morbidities, the cost may rise significantly.
For context, till February 2020, the cost of consumables used to be up to a maximum of 3-5% of the entire hospital bill, according to an SBI report.
The reason behind the extremely high usage of consumables in hospitals over the last 18 months is the highly contagious nature of the virus. Considering the severity of the pandemic, hospitals across the country have been forced to make it mandatory for staff to wear protective gear such as bodysuits and face shields all the time, and these add to hospital bills. While people without health cover have to pay the entire bill from their own pocket, those with a comprehensive health insurance plan have to bear the cost of consumables entirely on their own.
Underwriting rule changes
This is because, as per the underwriting rules of insurers, the cost of consumables under a health insurance plan is not payable by the insurance company. Consumables, in health insurance parlance, are non-medical items and hence, are not payable by the insurer.
With the advent of the virus, many insurers have started to make amendments in their underwriting rules and have decided to cover the cost of consumables through additional riders that may be bought along with the base plan.
‘No-claim bonus protected’
Apart from providing coverage for consumables, the riders also protect your No-Claim Bonus (NCB), provided the claim amount is up to ₹50,000.
Some riders also pay the customer for preventive health check-ups, wellness benefits, home care, doctor consultations, and diagnostics.
The average cost of the riders is 5% of the premium of the base plan. Say, if you choose a base plan whose annual premium is ₹8,000, the annual premium for the rider would be ₹400. Apart from these riders, there are standalone/comprehensive health plans that cover consumables without any rider.
These plans are reasonably priced and available starting from monthly premium of ₹600 for a 30-year-old individual with a ₹5-lakh cover. These plans pay for consumables like such as Personal Protective Equipment (PPE) kits on a case-to-case basis. In fact, as per market trends, the claims payout ratio is highest among people with cover for consumables.
Those already having a comprehensive health insurance plan, but still wish to be covered under a plan that covers the cost of consumables have the option of porting their health insurance plan.
Policyholders can now easily port their existing plan to a different insurer online without the requirement of any physical paper work. Porting can help enhance the sum insured, avail better features, reduce waiting period for pre-existing ailments, among other reasons. Porting can be done up to 45 days prior to the policy renewal date.
(The writer is Head-Health Insurance, Policybazaar.com)
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