Health Insurance

1
Health Insurance
Terms
2
Health

• WHO definition of Health
• Health is a state of complete physical, mental
  and social well-being and not merely the absence
  of disease or infirmity.

3
Look before U leap
4
Impression

• Insurance has never been a simple matter
• People make claims, become furious and sue the
  company
• Unfortunately, without really understanding the
  terms why insurance companies are resisting the
  coverage
• Policy holders feel that the terms are
  negotiable, but not
• But interpreted differently at various levels

5
contd

• Wording of Terms vary with the insurers elsewhere
  in the countries and also insurers in India
• Health Insurance is more complex with huge
  terminologies
• In India peculiarly, the dissonance in Health
  Insurance is high compared to Life Insurance
  despite limited penetration.
• The dissonance is generated amongst customers,
  insurers, health care providers.

6
contd

• Many controversial or touchy issues on the
  definition of terms and their applicability have
  been raised in litigation before consumer courts
  and ombudsman
• Shrinkage in selling the Health Insurance
  Products, by Agents, for various restrictions and
  market forces
• The industry treats the personal lines more like
  a financial services commodity

7
contd

• In the wake of these trends, consumers have to do
  more of their own analysis.
• To look to the terms and conditions that best
  meet their needs.
• Disputes
• What is covered and what is not covered?

8
Need

• Comparative provisions in Indian Health Insurance
• Alternative Benefits to fit into the needs of the
  individuals and groups not appearing in Indian
  contracts
• To introduce designing the products in clear
  terms
• Self bearing for price advantage/focus on
  certain categories
• Advantages of comparable products

9
Terms referred-

• Subject to the terms, limitations, exceptions,
  provisions, conditions, memos, warranties,
  endorsements contained herein, or endorsed
  hereon,( herein after collectively referred to as
  the Terms of this Policy)
• Study is restricted to Terms

10
Variance of Wordings of Terms

• Hospital /Nursing Home
• Hospitalization
• Pre admission authorization
• Domiciliary Hospitalization
• Any One Illness
• Pre-Hospitalization Expenses
• Post Hospitalization Expenses
• Medical Practitioner
• Qualified Nurse

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Contd-

• Pre-existing illness/disease/injury
• Disease contracted during first 30 days from the
  commencement of date of insurance cover
• Excluded Treatments for the first 12 months of
  the operation of insurance cover
• Maternity Benefit
• Naturopathy treatment

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Hospital

• Any Institution in India
• For indoor care and treatment of sickness,
  injuries
• Either been registered as a Hospital or Nursing
  Home with Local Authorities
• Under the supervision of a Registered Qualified
  Medical Practitioner

13
contd

• Alternatively
• At least 15 in patient beds/ C Class 10 beds
• Fully equipped operation theatre of its own
  wherever surgical operations are carried out
• Fully qualified Nursing Staff under its
  employment round the clock
• Fully qualified Doctor(s) should be in-charge
  round the clock
• Boundary
• Shall not include a place of rest, a place for
  the aged, a place for drug addicts or place of
  alcoholics, a hotel or a similar place

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Other definition (excerpts)

• Exclusively to an institution providing treatment
  in the system of western medicine (allopathy)
• Pursuant to the law for the care and treatment
• Maintain proper medical and patient records to
  the standards as required under prevailing laws
  and regulations
• Maintains appropriate quality for delivery of
  health care to the standards as required under
  the prevailing law

15
Canada

• A hospital duly authorized by Government
  Authorities which has twenty four hours a day
  nursing services by registered graduate nurses
  and organized facilities for diagnosis and major
  surgery and is not other than incidentally, a
  mental institution, a place for rest, a place for
  the aged, a place for drug addicts, a place for
  alcoholics or a nursing home

16
Hospitalization

• Minimum period of 24 hours, not applicable to
  specific treatments
• Stay in the hospital exceeds 48 hours
• 24 hours hospitalization, covers 130 minor
  surgeries needs less than 24 hours as Day Care
  Procedure
• Canada
• Incurred by the insured person as an in patient
  for a period of at least 6 hours in any
  recognized hospital

17
Pre-Admission Authorization

• Absolutely necessary to avail Cashless facility.
  It is necessary that the insured obtains pre
  admission authorization 72 hours before admission
  and 48 hours in case of emergency
• US
• An authorization for hospital admission given by
  a health care provider to a group member prior to
  their hospitalization. Failure to obtain a pre
  admission certificate in non-emergency
  situations reduces or eliminates the health care
  providers obligation to pay for service rendered

18
Pre-Hospitalization Post Hospitalization

• Relevant medical expenses incurred during the
  period up to 30 days before hospitalization for
  diseases etc sustained
• Covers relevant medical expenses incurred 60 days
  prior to and 90 days after hospitalization
• Canada
• Follow up treatment by the same physician
  reimbursable up to a period of ninety calendar
  days immediately after the discharge from the
  hospital

19
Any one illness

• Relapse within 45 days from date of last
  consultation with the Hospital
• After 45 days considered as a separate illness
• If two or more confinements are due to the same
  or related injury/illness or to any complications
  arising there from, such confinement if each of
  them is not separated by more than 90 days from
  the paid or payable. This rule shall be observed
  to determine the limit of benefits (Same
  Confinement)
• Recurrence Clause

20
Medical Practitioner

• A person who holds a degree/diploma of a
  recognized institution and is registered by
  Medical Council of respective State of India. The
  terms includes Physician, Specialist and Surgeon
• Elsewhere
• A physician, other than the Insured, Insured
  Person, or their Close Relative, qualified by
  degree in Western Medicine who is legally
  licensed and duly qualified to practice medicine
  and surgery authorized in the geographical area
  of his/her practice

21
Qualified Nurse

• A person who holds a certificate of a recognized
  Nursing Council and who is employed on
  recommendations of the attending Medical
  Practitioner
• Elsewhere
• Graduate in Nursing

22
Pre-Existing Condition

• To exclude claims arising out of the conditions
  for which treatment, care or advice is obtained
  before the commencement of the policy period
• Where treatment, care or advice was not taken
  and not known to the insured, are excluded

23
contd

• Pre-existing conditions means a medical condition
  which exists on the effective Date and during the
  past five years
• caused to receive medical advice or treatment or
• caused symptoms for which an ordinary prudent
  persons would seek medical advice or treatment

24
contd

• Sickness for which the insured or to the best
  of his knowledge and belief, was aware existed
  (or) symptoms for which an ordinary prudent
  person would seek medical advice or treatment
• Difficult to establish medically and also legally
  controversial and debatable

25
Maternity Exclusion

• Treatment arising from or traceable to pregnancy,
  child birth, miscarriage, abortion or
  complications of any of these, including
  caesarian section, infertility
• Pregnancy, miscarriage or child-birth including
  caesarean section, abortion, voluntary
  termination of pregnancy

26
contd

• US
• Sickness disease or illness which manifests
  itself while this policy is in force. Sickness
  includes the complications of pregnancy.
• Normal pregnancy is not a sickness but
  complications of pregnancy are treated as
  sickness

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Treatment (Exclusion)

• Naturopathy
• Other company
• Ayurvedic, homeopathy, unani, naturopathy,
  reflexology, acupuncture, acupressure, bone
  setting, herbalist treatment, hypnotism, rolfing,
  massage therapy, aroma therapy or any treatments
  other than allopathy/western medicine
• Western Medicine (Allopathy)

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Specific limits

• Room Rent
• Hospital Accommodation up to the costs of a
  single bedded air conditioned room
• Just in hotel, private hospitals normally offer
  different types of accommodation, known as
  banding, categorized as Band A to D

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Look Free Clause

• Please read this policy carefully to ensure that
  it meets your requirements. If it does not,
  please return it to us immediately. We would
  remind you that you must advise us fully and
  faithfully all the relevant facts you know or
  ought to know any changes in the information you
  have given to us otherwise you may not receive
  any benefit under this policy
• Meeting to the needs and Confirm within 10 days.
  Return the policy if not meeting the needs and
  refund is allowed. Benefit offered by insurers

30
Overseas Mediclaim

• Mediclaim Policy would stand suspended for the
  said period.
• The validity of period of insurance for Mediclaim
  protection shall extended for the same period
  beyond the scheduled expiry date.
• No adjustment or refund of premium shall be
  involved
• Does it appear as a condition?

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Special Products
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Family Policy

• Insures both the policyholder dependents
• Spouse
• Children

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Senior Citizen Policy

• Persons 65 years of age and above
• Supplementary to Medicare program

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Group

• Group Contract
• Master Contract/Master Policy
• Employer or other entity
• Relationship identified to the entity
• Certificates to individuals
• Economy under group approach
• Master contract is a detailed document
• Flexibility
• Experience Rating

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Contributory Plan

• Contribution by the employer and employee
• At least 75 employees to be insured

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Non-Contributory Plan

• Employer bears the full cost
• All eligible employees to be covered

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Cafeteria Plan

• Allows the participating employees
• To select among the displayed benefits using
  predetermined amounts of the employer

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Conversion Privilege

• COBRA
• Consolidated Omnibus Budget Reconciliation 1985
• Employers with 20 or more employees
• To extend the insurance benefit to the terminated
  employee, spouse, dependents, children
• Cover for 18 months to 36 months

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Other Qualifying Events

• Death of an employee and cover to the dependents
• Child ceases to be an eligible employee
• Reduction in employees coverage
• Reduction in the employees working hours
• Employee becomes eligible for Medicare

40
Conversion privilege Group Policy

• Right given to an insured person
• To change coverage, without evidence of medical
  insurability, to an individual policy upon
  termination of the group coverage
• The conditions under which conversion can be made
  are defined in the master policy.

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HIPAA A protection

• Health Insurance Portability and Accountability
  Act 1996
• Primary purpose of which was to help ensure that
  individuals would not lose their medical coverage
  or be subject to new pre-existing condition
  periods whey they changed or lost their jobs

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Non-Cancelable

• Guaranteed Renewal
• Right to continue the policy until specified age
• Insurer can not cancel nor make any changes in
  any provisions

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Optionally renewable

• Insurer reserve the right to terminate the
  coverage at any anniversary (or)
• At any premium due date but not in the middle of
  the due dates

44
Non-Occupational Policy

• Covers off the job accidents and illness
• Group accident and health insurance policies
  often fall in the category
• Non-Job Related accidents or sicknesses not
  covered under WC Insurance

45
Qualified impairment insurance

• Sub-standard insurance
• Restricts the benefits for the insured persons
  particular condition

46
Evidence of Insurability

• Statement or proof of a persons physical
  conditions
• Underwriting factor

47
Additional Purchase Option

• Permission to an insured to buy additional
  insurance
• Need not provide evidence of insurability

48
Minimum Premium Plan

• Insurance company administers claims for a fee
• Insure against large claims for self insured
  group
• The employer self-funds a fixed percentage of the
  estimated monthly claims
• The insurer covers the remainder

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Benefits
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Allocated Benefits

• Itemize the specific services
• Limit the maximum amount for the benefits

51
Unallocated Benefit

• Reimbursement of Maximum limit
• All extra miscellaneous hospital services
• Does not specify amount for each service

52
Waiver of Premium Benefit

• Policy holder is exempted to pay the future
  premiums
• Totally disabled during the life of the contract

53
Ancillary Benefits

• Secondary Benefits
• Added to the basic medical care
• Lab, X-ray, ECG and other services

54
Duplication of Benefits

• Overlapping of identical cover in various plans
• Known as Multiple Coverage

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Co-Ordination of Benefits

• To avoid duplication of benefits
• To cover 100 of health expenses
• To make out the order of payment the multiple
  insurer would pay
• India
• Doctrine of contribution

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Rider

• Increase or decrease or waiver of benefits
• Alter the base contract

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Clauses
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Insuring Clause

• Refers the parties to the contract
• Coverage of type of loss

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Recurring Clause

• Recurrence of a condition
• Continuation of a prior period of hospitalization
• India
• Any One Illness
• Same confinement

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Incontestable Clause

• Not to contest the validity of the contract after
  it has been in force for two/three consecutive
  years
• Non-cancelable/Guaranteed renewable health
  insurance contracts

61
Look Free Clause

• Free look to the policy
• Most companies provide at least 10 days to look
  at the policy from day of receipt.
• One is uncomfortable with the cover or terms,
  return and have your premium refunded
• Is not required by law but a benefit offered

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Self Bearing

• Benefit Period
• Cat Limit (Out of Pocket Maximum)
• Co-Insurance
• Co-Payment
• Corridor Deductible

• Deductible
• Flat Deductible
• Elimination Period
• Waiting Period
• Family Deductible Provision

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Benefit Period

• Choice of Elimination/Waiting Period
• Ranges from 0 to 365days
• Longer the waiting period, lower the premium
• Daily Benefit and Length of Benefit

64
Cat Limit/Out of Pocket Limit

• Limit the maximum benefit of large and unusual
  medical bill of the insured and family
• Maximum amount of covered expenses
• Separate limits for surgical expenses
• Separate limits for mental conditions
• Stop loss provision

65
Co-Insurance

• A fixed percentage of covered charges after
  applying the deductible
• 80 covered charges means
• Deductible and 20 to be borne by the insured

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Co-Payment

• One shall pay a fixed dollar amount for a service
  or benefit provided by a plan

67
Corridor Deductible

• A deductible between the benefits paid by the
  basic plan and beginning of supplemental major
  medical plan

68
Deductible

• Pay before the plan pays benefits
• Calendar year deductible
• Individual
• Family
• Inpatient hospital deductible
• Flat Deductible
• Percentage Deductible

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Contd-

• All Cause deductible
• All expenses are accumulated irrespective of
  number of illnesses or accidents
• Per Cause deductible
• All expenses incurred because of the same or
  related causes are accumulated to satisfy the
  deductible, for the expenses incurred during the
  benefit period

70
Family Deductible Provision

• Waives the deductible for all family members
  after any two or three of them individually have
  satisfied their deductible in the same year

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Third Party Administration
72

• Pure administrative services of programs designed
  by some one
• Billing and Enrolment
• ID Card Generation
• Claims Processing
• Management of Basic Net Work
• Reporting

73
Expectations

• Operational Effectiveness and Efficiency
• Turnaround time and quality standard in claims
  processing

74
Managed Care Plans
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Health Maintenance Organization (HMO)

• A health care system
• Assumes insurance and service risk
• The responsibility for health care delivery in a
• particular geographic area to HMO members, in
  return for a fixed, prepaid fee.

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Preferred Provider Organization (PPO)

• An indemnity plan
• Coverage is provided to participants through a
  network of selected health care providers (such
  as hospitals and physicians)
• The enrollees may go outside the network
• Incur larger costs in the form of higher
  deductibles, higher coinsurance rates, or non
  discounted charges from the providers.

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Exclusive Provider Organization (EPO)

• A more restrictive type of preferred provider
  organization plan
• Employees must use providers from the specified
  network of physicians and hospitals to receive
  coverage
• There is no coverage for care received from a
  non-network provider except in an emergency
  situation.

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Long Term Care
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Levels of Nursing Care

• Skilled Nursing Care
• Highest level of nursing care
• 24 hour care ordered by physician
• Registered/licensed nurse/therapist
• Intermediary nursing care
• 24 hours nursing not necessary
• Effective non-continuous care
• Custodial Care
• Basic level of nursing care
• Non-medical personnel
• Ordered by a physician and supervised by a nurse

80
Community Care

• Needs assistance and able to stay in the home or
  community
• Home health care Part time nursing care
• Adult care
• Respite Care
• Care in individuals home in a long term care
  facility temporarily
• Hospice Care
• Special care and emotional support for the
  persons diagnosed with terminal illnesses