Modern Treatments coverage in Health Insurance in India

The Insurance Regulatory and Development Authority of India (IRDAI) has been a harbinger of change in the country’s insurance landscape through its timely circulars and guidelines across various domains. These efforts have significantly shaped the orderly growth of India’s insurance sector especially Health Insurance.

In 2019, the IRDAI introduced guidelines on modern treatments with circulars like IRDAI/HLT/REG/CIR/177/09/2019, later reinforced in 2020 and 2024 through master circulars. These guidelines mandate insurers to cover a dozen technologically advanced medical procedures, including Balloon Sinuplasty, Robotic Surgeries, Oral Chemotherapy, and Stem Cell Therapy, among others. In fact, this is a visionary push to propel India’s health insurance into the 21st century.

It’s the regulator’s role to prepare the industry for changes whose time has come. The adoption of these modern advancements likely stems from an analysis of grievances faced by the insurance industry—particularly claim rejections linked to such procedures—coupled with pressure from the medical sector, as big corporate hospitals had adopted these advanced treatment methodologies, only to discover that patients struggled to afford them without sufficient insurance coverage.

Modern treatment coverage in Health Insurance Before IRDAI Guidelines

Prior to these regulations, insurance companies typically rejected claims or refused to pay the full amounts associated with these treatments during hospitalization, categorizing them as “unproven” or “experimental.” There was no standardization regarding what qualified as an advanced treatment or what was excluded; each insurer followed its own inconsistent approach.

The IRDAI introduced guidelines mandating coverage for 12 modern or advanced treatment methods. Currently, no insurance company cover modern treatment beyond those specified in this list. Although the IRDAI has encouraged insurers to include additional treatments as per their product design, none have expanded beyond the specified 12.

Even IRDAI has been reluctant in defining what constitutes a “Modern treatment” or “Technological advancement.” Due to the lack of this definition, the overall coverage regarding modern treatment is limited to what has been mandated by IRDAI.

Implementation of IRDAI Guidelines and challenges

All health and general insurance companies in India have adopted the IRDAI guidelines on modern treatments, revising their products to incorporate these advancements into their policies. As of now, every health insurance provider in India offers coverage for these modern treatment methods without exception.

However, even after the release of the first circular in 2019, the adoption process has not been seamless. Challenges and inconsistencies persist, reflecting a complex transition for the industry.

Coverage with Sublimits           
While the IRDAI mandates coverage for modern treatments, the fine print in policies often includes sublimits or caps that significantly reduce payouts. For example, robotic surgeries—far costlier than conventional treatment methods—are only partially covered, due to sublimit in the policy.

Often policies with higher sums insured may cover these treatments up to the full amount, however, even among lower-sum-insured options, a few stand out—such as ICICI Lombard’s Elevate policy, Oriental Insurance’s Youth Eco Care (with a ₹10 lakh sum insured), and Star Health’s Super Star policy.

Robotic Surgery Nuances        
When it comes to robotic surgeries, some insurance companies(mainly Public sector general insurance companies) cover only the “robotic” component of the bill up to a capped amount, reimbursing the rest as if it were a conventional procedure. Others pay the entire claim but restrict it to a predefined robotic surgery limit. This inconsistency adds to policyholder frustration and highlights the patchwork approach in the industry.

Transparency Woes   
Another frequent grievance is the lack of transparency. Policyholders often share stories of being initially assured coverage for treatments like Deep Brain Stimulation or Intra Vitreal Injections, only to face rejections later. Insurers commonly cite reasons such as the procedure being “experimental” or failing to meet specific hospitalization criteria—like requiring a 24-hour stay for treatments classified as daycare procedures. Means even if the modern procedure covered as per policy terms of insurance company, claims still get denied on the ground that it is not in a day care procedure!

Awareness Gaps          
Awareness remains a significant hurdle. Many policyholders are still unaware that their policies cover treatments like Vaporisation of the Prostate or Intra Operative Neuro Monitoring (IONM) until after paying out-of-pocket. This points to poor communication from insurers and agents about what’s actually included in the coverage.

Cost Challenges             
Cost is another critical concern. Treatments like Bronchial Thermoplasty or Stereotactic Radio Surgeries, while highly effective, carry hefty price tags that often exceed the sum insured in standard policies. This mismatch leaves policyholders grappling with financial strain, even when coverage is technically in place.

Precautions When Evaluating Health Insurance for Modern Treatments

To ensure comprehensive coverage for modern treatments, consider the following key checks:

• Coverage Without Sublimits: Verify whether the policy covers modern treatments up to the full sum insured without imposing sublimits. Sublimits can drastically reduce the payable amount, leaving policyholders to bear significant out-of-pocket costs for advanced procedures like robotic surgeries or immunotherapy.
• Restoration or Reset Conditions: Examine the policy’s restoration or reset provisions for the sum insured. Some policies restrict the use of restored sums for modern treatments, limiting access to funds after initial claims. Ensure no such conditions hinder coverage for these procedures.
• No Limiting Conditions on Modern Treatments: Confirm that the policy does not include restrictive clauses specific to modern treatments. Any ambiguous or limiting terms could undermine the IRDAI’s mandate for inclusion, so opt for clear, unrestricted coverage.
• Pre- and Post-Hospitalization Expenses: Check that the policy imposes no restrictions on pre- and post-hospitalization expenses related to modern treatments. Coverage for diagnostics, consultations, or follow-ups (e.g., for oral chemotherapy or stem cell therapy) should extend seamlessly without arbitrary caps or exclusions.

Honestly, if IRDAI hadn’t stepped in, many of these modern treatments wouldn’t be covered by insurance companies in India. IRDAI deserves all credit for making that happen. But now, the regulator needs to do more than just mandate coverage for a fixed list of treatments. IRDAI should expand this list and encourage insurers to voluntarily include more advanced procedures in their policies.

We also need clear guidelines on what qualifies as a ‘modern’ medical advancement. Without that clarity, many life-changing treatments could be left out of coverage.