What IRDAI's order means for mental health coverage in India

The pandemic and lockdown threw light on a topic that has always been pushed behind closed doors. There has always been a huge stigma when it comes to mental health and wellness.

Post-pandemic times are a lot different. Now, mental health is also taken as seriously as physical illness. This has impacted the insurance industry as well.

On August 16 this year, the Insurance Regulatory and Development Authority of India (IRDAI) asked insurance companies to make provisions to cover mental illness.

This regulation by the IRDAI is a welcome move to bring about uniformity. Earlier, only selective companies included mental illness in their benefits and not all of them, as a standard. With this initiative, everyone will have mental illness covered and provide accessible treatment. It is good to see authorities break taboos by treating mental health at par with physical health.

Now that the IRDAI has directed insurance companies to provide coverage for mental illness under health insurance policies before October 31, 2022, we are seeing the remaining 70% of the insurers starting to cover mental health as well.

Earlier, hospitalisation (in-patient department or IPD) due to mental illness was covered by most of the top-tier insurers like the large PSUs by default. Around 30% of the insurers already had provisions for this. The rest of them used to add this coverage on a request basis.

As per the National Mental Health Survey of India for FY16 conducted by the National Institute of Mental Health and Neuro Sciences, nearly 15% of Indian adults need treatment for one or more mental health issues.

Mental health insurance covers any expenses incurred if one has to be hospitalised under in-patient care due to any mental illness. It includes diagnostics, medications, treatment costs, room rent, road ambulance charges, etc.

However, these insurance policies often do not give coverage for consultations and counselling. In some cases, companies have now taken the initiative to provide counselling, meditative sessions, and consultations as an additional offering.

In these dynamic times and with increased awareness, people find checking in with mental health very important and thus, will also look to avail this rather than the one with just the IPD coverage.

Things to remember to avail the most of the mental health benefits

The minimum time of hospitalisation for a mental illness patient has to be 24 hours for a person to claim the expenses using their health insurance. Some of the known diseases that fall on the list of mental illnesses include acute depression, bipolar disorder, schizophrenia, anxiety disorder, OCD, ADHD, PTSD, mood disorder, and psychotic disorder.

Like all other pre-existing conditions, mental illness benefits also have a waiting period that needs to be borne by the insurer.

The waiting period with most insurers is generally two years, which means one has to wait for that duration after buying insurance to be able to claim for the expenses incurred due to mental illness.

To conclude, the IRDAI’s move is a great step towards a more inclusive world making sure that everyone is taken care of.

(The author is Head of Strategy at Pazcare, an employee benefit and insurance brokerage firm)