Why is it important to consider mental health in health plans?

Health insurance plans in India have been evolving over time to the growing need in order to include mental health coverage. As per National Mental Health Programme (NMHP) estimate 6-7% of the population suffers from a mental disorder since mental health in India has long been disregarded. However, in today’s time, there is an increasing understanding that mental health is equally essential as physical health and well-being.

Health insurance focused primarily on physical ailments earlier, overlooking mental health. Recognizing the significance of mental health, a circular released by IRDAI in February 2023 mandates all insurers to provide a dedicated product catering to individuals with disabilities. This product ensures coverage for expenses related to inpatient hospitalization resulting from mental illness, alongside physical health conditions.

Although, the introduction of the Mental Healthcare Act of 2017 in India marked a significant change. The Act also outlines mental illness as disruptions in mood, thinking, perception, orientation, or memory that significantly affect behavior, decision-making, judgment, or everyday activities.

It is imperative today to comprehend the terms and conditions which are associated with mental health coverage. Generally, insurers do not assign a specific waiting period for mental illness. However, any mental condition declared at the time of purchasing the policy will be considered a pre-existing condition, and its waiting period will be applicable as per the terms and conditions of the product.

Another important factor for consideration by insurance providers is any pre-existing mental illness. Insurers may exercise discretion in selling insurance plans to individuals with a recent history of acute mental illness. While some insurers may deny proposals based on their risk appetite, others may accept proposals with certain premium loadings. This precautionary measure ensures the financial viability of the coverage and manages potential risks.

Many health insurance policies may have sub-limits on coverage for specific mental illnesses. Conditions such as schizophrenia, bipolar disorder, psychosis, and depression may have sub-limits on inpatient hospitalization coverage amounts, depending on the provider. Individuals seeking mental health coverage should opt for plans without any sub-limits or capping to ensure comprehensive access to treatment.

The inclusion of mental health coverage in health insurance policies serves several purposes. It recognizes the significance of mental health in overall well-being and provides individuals with financial support for treatment expenditures.

In conclusion, mental health coverage is a crucial component of health insurance plans to ensure individuals receive the necessary care. Mental health coverage supports equity and accessibility, by standardizing the concept of taking professional assistance for mental health troubles. In order to seek timely treatment and support individuals are persuaded to prioritize their mental health and well-being.

By Pooja Yadav, Chief Product Officer, Zuno General Insurance