Under a mediclaim policy, the insurance company is required to reimburse the cost of hospitalization and treatment. What happens when the follow-up treatment after discharge requires use of expensive medical equipment? Is the insurance company liable to reimburse the cost of the equipment? Yes, says a significant ruling of the Delhi State Commission.
Vibhu Anand had a mediclaim policy issued by Oriental Insurance. During the subsistence of the policy, he was hospitalized for “Sleep Apnae syndrome with upper airway resistance”. The doctor advised him to use a “continuous positive airway pressure” (CPAP) machine for controlling his illness. (Sleep Apnae is a disease which cannot be cured. It can kill a patient while sleeping. The only remedy is to control it with the use of a CPAP machine. Without this machine, the patient’s life is at risk). This equipment cost him Rs 46,000.
When he lodged a claim, the insurance company disallowed the reimbursement, saying it was an external device not covered under the policy. Anand filed a complaint before the district forum. The insurance company claimed the reimbursement was permissible only with respect to items implanted in the body. Since CPAP was an external device, reimbursement was not permissible. The forum concurred with the view taken by the insurer and dismissed the complaint.
Anand appealed before the Delhi State Commission, which observed that CPAP was the only life-saving device to control the condition. The policy provided reimbursement towards expenses incurred for anaesthesia, blood, oxygen, operation theatre charges, surgical appliances, medicines and drugs, diagnostic materials and X-rays, dialysis, chemotherapy, radiotherapy, pacemaker, artificial limbs and cost of organs, etc. The commission questioned why the CPAP machine would not be covered when the policy provided for reimbursement towards artificial limbs, which, too, are neither embedded nor implanted in the body.
The insurance company claimed that unlike a CPAP machine, artificial limbs formed a part of the body. So, artificial limbs were covered, but a CPAP machine was not. Terming this as self-defeating argument, the commission said any equipment for treatment would have to remain with the body, either inside or outside, for the purpose of treatment. Since artificial limbs and similar expenses were covered under the policy, it held the expense for the machine would be reimbursable under the terms of the policy.
The insurance company then contended the insured could claim reimbursement and sell the equipment after he was cured, thereby getting double benefit. The commission rejected this argument, saying even as it would be possible to sell an artificial limb in the market, the claim for artificial limbs was covered under the policy. Hence, there cannot be any justifiable reason for denying the claim for a CPAP machine. Moreover, the insurer can protect itself by taking indemnity from the insured that if the equipment was sold in the market, the insured would be liable to refund the amount realised from such sale.
Accordingly, the commission directed the insurance company to reimburse the entire cost of the machine and also awarded costs of Rs 2,500.
The impact can best be summed up in the court’s observations that a non-issue had been made into an issue by the insurance companies by denying liability despite the terms of the policy and the directives of the Insurance Regulatory and Development Authority being clear, thereby wasting the court’s time.
The author is a consumer activist. Views expressed are personal
