REJECTION is a tough word to hear & bear - especially when it’s a case of the HEART or the FINANCES!
Imagine this -
You are a smart person and availed of a premium health insurance plan for your entire family as the perfect financial security net that would cushion your savings in cases of medical emergencies. Unfortunately enough your dad gets hospitalised for a knee replacement surgery.
While you are worried about your dada when he is on the operating table, you are financially secure with the best policy coverage shield. By God’s grace, your dad recovers well and is discharged. Being the financially smart person that you are, you have already raised a claim with the certainty of a cashless claim settlement.
However, during discharge, SURPRISE SURPRISE, you come to know that your claim has been rejected. And now, you will be paying off your hospital bill out of your pocket despite having a reputed health insurance plan.
This is a FINANCIAL NIGHTMARE, isn’t it? The obvious question that comes to your mind is why was your claim rejected in the first place. Is there anything that you could have avoided? What other such situations could bring such rejections in the future?
And hence, we say know it all before you avail of a health insurance policy! But hey! No preaching. Let’s just know the truth of health insurance rejection, shall we?
Why Your Health Insurance Claims Can Get Rejected?
- Incorrect Information on Claim Papers
- The claim was raised within the waiting period
- Missed out on Pre-Authorisation/Prior Approval
- Absent documents on the claim papers
- Condition falls under permanent exclusion list
- Lapsed health insurance plan
- Missed out on mentioning Pre-existing ailments
- Forgot about Copayment/ Coinsurance/ Deductible/ Disease-Wise Sub-Limit clauses
- The claim was raised after the allowed time window
- The sum insured is exhausted
Health insurance plans are availed of as a major financial fallback. The premiums of the best health insurance policies are not exactly very cheap. So, when one pays off a section of their salary towards availing of a health insurance policy, they expect fool-proof support.
Under such circumstances, in case your claim settlement gets rejected, it’s a major setback. Considering the spiked medical inflation, increased exposure to health scares, and the availability of genuine recovery rates and cures over modern treatment methods, you are staring into an abyss of financial catastrophe unless you have a plan in place.
Hence, purchasing the best health insurance plans is not enough! You need a deeper understanding of the existing loopholes in your policies to ensure that you don’t end up paying the premiums for a plan that fails to come to your rescue during medical happenstances.
For this in-depth knowledge, you need to be acquainted with the most probable reasons for health insurance policy claim rejection -
REASON 1: Policyholder provided incorrect information on His/Her Claim
When a policyholder raises a claim, the application form requires certain details that include - the patient’s name, the medical procedure involved, the doctor’s name, policy number, etc. In case he/she inputs the wrong information in any of the fields, there are high chance of the claim being rejected.
SOLUTION: Claim settlement forms are filled in during pretty stressful times. Worries about the patient’s health, the impending medical procedure, the anticipation of the recovery process and the chances of complications - all float around in the mind of an individual. Filling in all the correct data during such times might just be pretty cumbersome. The best solution would be to
- Have another individual cross-check the details filled in and
- Carry the health insurance card.
REASON 2: The Claim raised is within the waiting period
Any policy even from the best health insurers comes with a certain waiting period. During this span, no claims raised will be covered by the insurance provider (except in the case of an accident, the coverage of which is not conditioned by any waiting period).
SOLUTION: Take a look at your health insurance policy document soon after you have availed of the plan. There is a section that talks about the waiting period on your plan across multiple fronts -
- Commencement waiting period (up to 30 days of the purchase of the policy)
- Specific illness waiting period (2 years)
- Pre-existing ailments (2 - 4 years)
- Maternity perks (2-4 years)
Staying aware of these waiting periods ensures that even if you have to raise a claim during these waiting periods, you will stay well-prepped for the impending financial burden that you will have to bear while paying off the bill.
REASON 3: Policyholder forgot the pre-authorisation/prior approval
Certain medical procedures and treatments require pre-authorisation or prior approval from the health insurance provider. A policyholder has to properly file the case with his/her health insurer and/or Third Party Administrator (TPA). In case a policyholder undergoes such a procedure and doesn’t yield a pre-approval for the coverage of the same, the claim settlement request will be rejected by the insurer.
SOLUTION: Now, such medical procedures are usually never urgent or a consequence of any accidents. Hence, policyholders get ample time to file for the pre-approval. Such advanced reach out to the insurer also helps with the availing of the cashless mode of claim settlement.
REASON 4: The Policyholder forgot to attach some documents with the claim
In the case of the cashless mode of settlement of claims, the medical documents, reports, discharge history, etc. are submitted from the hospital desk to the insurer/TPA. This leaves a very low chance of human error.
However, when it comes to the reimbursement claim settlement channel, the document is collected by the policyholder and then submitted to the insurer/TPA, who in turn cross-checks the details with the respective hospital desk. This leaves much room for error. If there are any missing documents or any wrong ones, claims can very well be rejected by an insurer.
SOLUTION: Take a look at your policy document and ask your insurer about the required documents. Then make a list of these documents and cross-verify the same before you submit your claim settlement application form.
REASON 5: The condition falls under the permanent exclusion clause
Each health insurance plan - group, family, and individual comes with a set of permanent exclusions. These are the medical conditions that will not be covered by the provider under any circumstances. As a policyholder, you have to be very careful about these listed conditions. In case you file a claim for any of such ailments, your health insurance provider will not offer you coverage, despite you having an adequate sum insured in your plan.
SOLUTION: Take down a list of the permanent exclusions in your plan. In case you have any ailments that you are genetically inclined towards or have acquired any of them from beforehand, do choose a plan accordingly by using a free health insurance policy comparison tool by factoring in the specific health condition.
REASON 6: The Health Insurance Policy has lapsed
In case you have missed out on renewing your plan, or are even in the granted grace period, all claims raised will be turned down by the health insurance provider in question. While you might still be in the window of continuing with your old plan, you are left vulnerable sans any policy coverage.
SOLUTION: Health insurance policy renewal is a very high priority. Setting reminders for the same to pay up for the renewal in advance and not even stepping into the grace period is the sure shot way to easily avoid the health insurance policy rejection for this reason.
Also, do remember that this cause of rejection is only a concern if you are looking at the reimbursement mode of settlement. Because in the case of cashless settlement, since you will have to submit your health insurance card in advance, and since that comprises the validity of your plan, any lapse in policy will be cleared at the hospital desk itself, leaving you with plenty of time to prepare for the finances.
REASON 7: Policyholder failed to disclose any pre-existing medical conditions
Non-disclosure of pre-existing medical ailments is a very common phenomenon among policyholders because they are often of the notion that such mentions might lead to no coverage.
However, sooner or later, such conditions quickly come to the forefront for the insurers who then reject any claim raised by the policyholder because even if it’s not the particular pre-existing condition for which a claim is being raised, it might just be an auxiliary one. You might even be looking at a cancelled health insurance plan in such cases.
SOLUTION: Complete disclosure of medical conditions is always the right way to go. Whether we are talking about health insurance for smokers, chronic ailments, diabetes, or any other ailment, if you have a condition, let your insurer know. The maximum that will happen in such cases is that you will be seeking a more customised policy that caters to your health condition and a spiked premium owing to an added loading charge on the base amount.
REASON 8: Policyholder forgot about copayment/ coinsurance/ deductible/ disease-wise sub-limit clauses
During the purchase of some health insurance policies, policyholders are offered copayment, coinsurance, deductibles, and disease-wise sub-limits clauses on the plans with the promise of a mitigated premium.
While some of the above might be a perk in some edge cases involving complicated ailments and/or senior citizens, they also suggest that you will not be getting complete coverage despite having an adequate sum insured in your policy. In such cases, your claims will only get partially settled based on the pre-decided copayment, coinsurance, deductibles, and disease-wise sub-limits clause.
SOLUTION: If you have a chronic/critical ailment or a senior citizen who is finding it difficult to avail of a health insurance policy, or looking at a spiked premium due to such conditions, then you might find the clauses to be a necessity. In such cases, stay prepared for the pre-set percentage or fixed amount that you will be required to pay during the discharge process.
If these are not the conditions that hold true for you, then try and avoid such policies that come with these terms as a mandatory situation.
REASON 9: Policyholder forgot to raise the claim within the pre-set time window
In the case of reimbursement modes of claim settlement, there is come with a stipulated window of time within which the claim needs to be raised. If one misses out on this window and raises a claim post this time, then no matter if the ailment is completely covered by the plan, the insurer will still not settle the claim.
SOLUTION: Take note of the number of days within which you have to raise the claim, whether it’s a pre-decided procedure or an accident case. Such terms vary from one insurer to the other and can be found in the policy document. Make it a point to remember this detail when you are filing for a claim settlement in each case of hospitalisation.
P.S.: Please remember that your health insurance policies also cover pre and post-hospitalisation perks. To file for such invoices, your insurer also offers you a separate window. Make sure to check that time span to tap the maximum benefits out of your policy
REASON 10: The assigned sum insured has already been consumed via earlier claims filed across the year
For those with chronic ailments or severe health conditions, frequent hospitalisation is an obvious situation. Such multiple hospitalisations might lead to a majority or complete exhaustion of the sum insured assigned. In such cases, health insurers do not have any bandwidth left to settle the claim raised and hence, they turn down the claim settlement request.
SOLUTION: Opt for a health insurance plan that comes with an unlimited restoration perk that is in-built or is available as a health insurance add-on for your policy. This will make sure that you never run out of your total sum insured, irrespective of the number of times a claim is raised across a year.
These are the top 10 reasons why a health insurance policy can get rejected by an insurer. Now, let’s say a health insurance claim gets rejected, what should you do? Here, take a look -
What To do after your Health Insurance claim gets rejected?
STEP 1: Analyse why your Health Insurance claim was rejected
First of all, you need to find out why your health insurance policy claim was rejected by your provider.
- Cross-check your claim settlement form application form and the details that you have provided.
- If there are no errors on your part in the claim application form, then reach out to your TPA/insurer and request help regarding what error might have led to the health insurance policy rejection.
STEP 2: Reach out to your Health Insurer/TPA & the hospital about Claim Re-Application
Once the issue that led to the health insurance policy rejection has been detected, if the issue can be dealt with, you can reach out to your health insurer/TPA and your hospital and inform them about reinitiating the health insurance policy claim settlement process that you can now start.
You can challenge the health insurance policy rejection over a call or an email. However, make sure to record all the conversations that you have had with the hospital and the TPA/insurer over emails that resend to the respective party.
STEP 3: Stay ready with the required documents
Whether the issue was that of a missing document, an error in details input, or submission of a document altogether - now that you know the issue, keep the required document handy. Once you challenge the previous claim rejection, you will need to re-submit the correct document/data.
STEP 4: Reinitiate the Claim Process
With all the documents ready for the go, you can now challenge the policy rejection via a formal letter that is sent over to the TPA and/or health insurance provider. The letter must contain a statement comprising
- The accurate policy number and details
- The valid reason as to why your claim stands valid despite it being rejected last time
- Appropriate documents
- A note from a licensed medical practitioner who will support the accurate claim details
Now, these are the normal cases in which the claims can be settled over the formal channel. But what happens if the results thus yielded are not up to your expectations? Here’s what -
EDGE CASE
1. Approach the Ombudsman Forum: Within 30 days of receiving the response from the health insurance provider/TPA about your claim settlement process reinitiation, approach the nearest Ombudsment office and file your concern. The Ombudsman forum, acting as a mediator will arrive at a recommendation for you about your case even if it goes against the previous decision that had been provided by the insurer.
2. File a report at the Consumer Court: If the decision offered by the Ombudsman court is unsatisfactory as per your expectations, you can take up the case to the Consumer Court, which would require you to be supported by legal counsel/aid. However, in this case, the fees charged might be higher than what your health insurer needs to settle.
In a Nutshell
A health insurance policy is a financial backup that is supposed to shield you during a medical storm and thus the premium that is paid towards the policy seems nominal. However, if and when a health insurance policy claim is rejected, all hell breaks loose. The policyholder, who already is at a stressful time, visualises his/her finances slipping out from the hands, despite having a great health insurance policy in place.
Thus, it is important to know what are the reasons for a health insurance policy rejection, what are its solutions, how can one avoid it, and the steps that you need to take once the policy has been rejected by your health insurance provider/TPA.