Medical insurance may point to more inclusive healthcare policies for patients, the insurance regulator has removed around 10 items, including procedures such as dental, stem cell, infertility, and psychiatric treatment, from the list of “optional covers” for health insurance.

The Insurance and Regulatory Authority of India (IRDAI) in a notification Monday said in a partial modification of guidelines on standardization of health insurance business some items have been deleted from the list of “items for which optional cover may be offered by insurers”.

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Dental Medical Insurance

These include dental treatment that does not require hospitalization but is widely availed of, hormone replacement therapy, infertility, subfertility, assisted conception procedures, obesity treatment, psychiatric and psychosomatic procedures, corrective surgery for refractive error, treatment of sexually transmitted diseases, any expense for retrovirus or suffering from HIV and AIDS, stem cell implantation, etc.

‘Covering more procedures in insurance will fix anomaly’

Industry executives say the move to include more medical procedures in insurance is aimed at correcting an anomaly. “Earlier these items were optional and, therefore, were not covered by most insurers. Now, insurers can design products to include these items,” an industry analyst and researcher said.

Infertility Medical Insurance

The insurance regulator may soon provide more clarity by issuing a separate order making it binding on companies to include these procedures in their plans, according to a source. Insurance penetration in India remains low.

Merely 43 crore individuals, or 34% of the population, were covered under any health insurance in the year 2016-17, according to the National Health Profile 2018, compiled by the Central Bureau of Health Intelligence.

Despite the spread of private coverage, growth in health insurance is mainly driven by government-funded schemes or social insurance. Private sector coverage is largely limited to urban households. Even among those who have some coverage, 79% are under public insurance companies.

While these companies have a higher share of coverage and premium for all types of health insurance policies, except family floater policies, including individual policies, private-sector schemes lead to high out-of-pocket expenditure.

According to NHP 2018 data, the claims ratio by private insurers was 67%, whereas by public insurance companies 120% during 2016-17.

In 2017, 70% of the total expenditure on health in India was paid out of pocket, according to WHO’s health financing profile.