Health insurance has, today, become a virtual necessity due to the rising costs of healthcare. Most insurance companies offer cashless claims and reimbursement benefits to health insurance policyholders. One assumption you often make is that when you put up the hospitalization claim to your insurance company, it would automatically be approved. However, there are a number of cases where health insurance claims can be rejected. What are the grounds for rejection and what steps to take if your health claim gets rejected?
Why do health insurance claims get rejected?
Your health insurance claim can be rejected for a number of reasons and here are a few common reasons it could happen.
Claim form submitted by you to the insurance company may be inadequate in terms of original bills, appliance jackets, medical reports, hospital stamp etc.
The insurance company feels that hospitalization was not required for the said problem and hence the claim may be rejected.
The health problem for which you were hospitalized may be in the specific exclusion list of the insurance policy and may have been mentioned in the fine print.
The insurance company concludes based on the medical reports of hospitalization that you did not disclose critical health issues at the time of taking the policy.
There are some diseases that are not covered during the cooling period i.e. the first year of taking the policy and these can be a cause for claim rejection.
What to do if the claim is rejected on procedural grounds
Quite often, there are procedural issues like inadequate bills or unstamped bills or inadequate documents enclosed. These can be easily rectified as you only need to add the additional documents and re-submit. It is always better to take the help of a TPA (third party administrator) before filing the claim.
Insurance companies also reject claims on technical grounds. For example, the insurer may feel that advance intimation was not given to the health insurer or that the process did not require hospitalization. In such cases, your doctor can write a letter stating reasons why the hospitalization was necessary and why, due to emergency situation, advance intimation could not be given to the insurer. Normally, this is good enough!
What if there are genuine reasons for the claim rejection?
Let us say the claim got rejected because it was still in the cooling period. In such cases, you may not have much of a choice, although you can still make a special request. In special cases like COVID-19, the government had instructed IRDA to ensure that insurers do not reject COVID-19 claims on technical grounds.
Then there is the more serious issue of claims getting rejected due to non-disclosure of information or furnishing wrong information. Misguiding the insurer is a genuine ground for rejection of claim and this is something people should scrupulously avoid.
A slightly more ambiguous area is where some health issue was not disclosed but then this was more due to lack of awareness, rather than any intention to conceal it from the insurance company. In such cases, you can still claim the money on grounds that all information was given on good faith.
What if the insurance company still does not accept your claim?
If you have genuine reasons to make the claim, then you can re-submit your claim giving all documents including other health tests and a certificate from the doctor to the effect. This can again be forwarded to the insurance company through the TPA. There is no limit to the number of appeals you can make to the insurance company to validate your claim.
If you don’t hear from your insurance company within 30 days, you can approach the insurance Ombudsman; a complaint redressal mechanism set up by IRDAI. If you are still not satisfied with the Ombudsman ruling, you can approach the court, but that can be a fairly long-drawn process.
Avoid health insurance rejections proactively
While taking a health cover insist on a medical test. In case the policy does not require a medical test (normally people under 46 are not required to give medical test in many cases), ensure your health disclosure is in the policy document and retain an acknowledgement.
Ideally, go for cashless policies, because in such cases the insurance company is required to give advance approval to the hospital. Here, the hospital is in a better position to explain medical issues to the insurance company and the process of claim acceptance and direct payment to the hospital is smoother.
Lastly, there is an important to remember. No health insurer can reject your claim if you have continuously paid premiums for 8 years. This is specifically stipulated by IRDAI. But, the moral of the story is that a little bit of transparency and procedural detailing from your side can go a long in reducing the chances of your health claim getting rejected.