Health Insurance Claims in India: Key Challenges and How to Overcome Them

Policyholders in India face numerous obstacles when filing a health insurance claim. Experts indicate that nearly half of all claimants encounter difficulties during the process, ranging from documentation issues to delays in settlement. These challenges can amplify stress during already difficult health situations. However, with proper knowledge of common issues and strategic approaches to the claims process, policyholders can significantly improve their chances of a smooth experience.

Introduction

When you subscribe to a health insurance policy, you expect it to act as a financial safety net during medical emergencies. However, the true test of any insurance policy comes at the moment of filing a claim. Unfortunately, the claim settlement process in India is often affected by challenges that can leave policyholders frustrated and financially strained.

Recent data paints a concerning picture. According to a survey, approximately 43% of policyholders faced difficulties while filing health insurance claims, with some even having to extend their hospital stay by an extra day due to processing delays. Knowing more about such challenges and understanding how to tackle them can ensure a hassle-free claim experience.

The Current Landscape of Health Insurance Claims in India

The health insurance sector in India has grown substantially over the past decade. However, this growth hasn’t necessarily translated to a smoother claims experience:

• The overall claim settlement ratio for health insurers hovers around 88-90%, meaning that 10-12% of claims face rejection.
• The average time taken for claim settlement ranges from 20 to 46 days, with some cases stretching longer.
• Claim-related complaints are amongst the most common grievances received by the insurance ombudsman.

These statistics highlight the gap between policy purchase and successful claim settlement, reinforcing the need for policyholders to be well-prepared when filing claims.

Major Challenges in Health Insurance Claims

Here are some of the major challenges that you can face with your health insurance claims:

1. Documentation Issues

One of the most common roadblocks in claim processing is inadequate or improper documentation:

• Missing or incomplete claim forms that lack essential details
• Absence of original bills and receipts from hospitals
• Insufficient medical records or incomplete diagnosis information
• Discrepancies between hospital bills and the treatments received
• Missing pre-and-post-hospitalisation expense proofs

2. Policy Exclusions and Waiting Periods

Many policyholders are caught off guard by exclusions they were not aware of:

• Pre-existing disease clauses that exclude coverage for conditions you had before buying the policy
• Specific waiting periods for certain treatments or procedures
• Sub-limits on room rent, specific procedures, or disease categories
• Exclusions for certain medical conditions or treatments that aren’t covered at all
• Time-bound exclusions that apply in the initial years of the policy

3. Claim Processing Delays

Delays in claim processing can create significant financial and emotional stress:

• Extended verification processes that go beyond stated timelines
• Multiple rounds of additional document requests from insurers
• Delays in receiving pre-authorisation for planned procedures
• Slow communication between hospitals and insurance companies
• Backlogs during peak seasons when claim volumes are high

These delays often force patients to stay in hospitals for extra days or pay out of pocket initially, causing financial strain and uncertainty.

4. Network Hospital Limitations

Network hospital-related challenges add another layer of complexity:

• Limited network hospital options in smaller cities and towns
• Variations in empanelment across different insurance providers
• Cashless facility denials despite being at a network hospital
• Different procedures and protocols across hospital chains
• Exclusion of certain departments or treatments even within network hospitals

5. Billing and Coding Discrepancies

Technical issues in billing often lead to claim disputes:

• Hospital bills that don’t match pre-authorised amounts
• Incorrect procedure codes used in hospital documentation
• Unbundling of procedures to increase billing amounts
• Non-medical expenses incorrectly included in treatment bills
• Discrepancies between electronic and physical bills

These issues can result in partial claim approvals or complete rejections, leaving you with unexpected out-of-pocket expenses.

How to Overcome Health Insurance Claim Challenges?

Here are some actionable tips to help you address the common issues with health insurance claims:

1. Before Hospitalisation: Proactive Measures

Taking proactive steps before hospitalisation can prevent many common claim issues:

• Thoroughly read your policy document, particularly the fine print regarding exclusions and waiting periods.
• Contact your insurer for pre-authorisation at least 48-72 hours before planned hospitalisations.
• Verify if your chosen hospital is in the network and if your specific treatment is covered under the cashless facility.
• Keep digital copies of all previous medical records organised and accessible.
• Check sub-limits applicable to your policy for room rent, specific procedures, and disease categories.

By understanding your policy thoroughly before you need to use it, you can avoid unpleasant surprises during the claim process.

2. During Hospitalisation: Documenting Best Practices

Proper documentation during hospitalisation is crucial for smooth claim processing:

• Inform the hospital insurance desk about your health insurance coverage immediately upon admission.
• Ensure all medical procedures and diagnoses are accurately recorded in hospital documents.
• Collect and verify all bills, including interim bills, before final settlement.
• Keep a record of all medications you receive during your hospital stay.
• Document any additional procedures or treatments that were not initially planned.

Maintaining a complete paper trail helps prevent disputes later in the claims process.

3. Post-Hospitalisation: Strategic Claim Submission

After discharge, follow these steps for effective claim submission:

• Submit all necessary documents within the given timeframe, typically 15-30 days after discharge.
• Include a cover letter summarising the claim details and listing all attached documents.
• Maintain copies of all submitted documents, along with proof of submission.
• Follow up regularly on your claim status using the insurer’s tracking system.
• Keep a record of all communications with the insurer or third-party administrator (TPA), including the names of representatives and reference numbers.

Prompt and complete submissions significantly improve your chances of a timely claim settlement.

4. Choosing the Right Health Insurance for Smoother Claims

Selecting the right health insurance is the first step toward a hassle-free claims experience:

• Compare claim settlement ratios and turnaround times across insurers
• Check for policies with minimal sub-limits and reasonable waiting periods
• Look for plans with extensive network hospital coverage in your area
• Consider insurers with dedicated claim assistance services
• Review customer feedback specifically related to claim experiences

An individual health insurance plan with a strong track record of claim settlements may cost slightly more, but often proves invaluable during claim time.

Conclusion

While health insurance claims in India continue to present challenges, being prepared and informed can significantly improve your experience. Understanding common pitfalls, maintaining thorough documentation, and knowing your rights as a policyholder are powerful tools in overcoming these challenges.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.