20, February 2010
By Shibu Thomas
In the midst of the intense war between hospitals and medical insurance companies over health insurance reimbursements, here’s some heartening news for policy holders. The Central Mumbai District Consumer Disputes Redressal Forum, in a landmark order, has held that an insurance company is liable for deficiency in service if it fails to reimburse hospitalisation costs of a patient who has a Mediclaim policy with it.
The forum ordered Oriental Insurance Company and Raksha TPA to pay Rs 64,223 to an Andheri-based couple, Ketan (47) and Bhakti Desai (40); the amount had been deducted by the insurer from the hospitalisation reimbursement on the ground that it was “too high’’. The bench, comprising president S P Mahajan and members J S Iyer and S S Patil, also asked the insurance firm to shell out Rs 10,000 to the couple as damages for causing mental agony and legal costs. The company paid up the amount earlier this month.
“The company’s attitude was outrageous,’’ Ketan told TOI. “I had a Mediclaim policy with the company for over 10 years and was very regular in renewing it annually and paying the premium. I only claimed the amount that was applicable, and so it was a shock when the firm deducted the amount. Once the insurance company approves the hospital bill, how can it say it won’t pay?’’
The Desais had a joint Mediclaim policy with Oriental for Rs 5 lakh. Bhakti underwent a surgery for “gall bladder calculus with pancreatitis’’ at Lilavati Hospital in December 2007. Following her discharge, they submitted the hospital’s bill of Rs 3.94 lakh to the insurance company for reimbursement. Oriental, however, paid them only Rs 3.29 lakh. It said it had deducted Rs 64,223 on the ground that the fees charged by the surgeon, the anaesthetist and the operation theatre bill were too high. ‘No proof of hosp being unreasonable’
Not only did Oriental Insurance Company refuse to pay Andheri couple Ketan and Bhakti Desai the fees charged by doctors and for the operation theatre, it also deducted Rs 293 charged for cologne, a blade and a warm blanket.
Desai, who was represented by advocate Ashish Jain of the law firm Sanjay Udeshi and Company, said that the insurance company had undertaken to reimburse all hospitalisation expenses. Advocate Kushal Dhavan, counsel for Oriental, contended that the deductions were genuine. The lawyer pointed to the policy terms which mentioned that the insurance company would reimburse “reasonable, customary and necessary expenses’’. Dhavan also argued that the couple were not “consumers’’ in accordance with the Consumer Protection Act.
The consumer forum, however, did not agree and said that the deduction of the amount by Oriental was “liable for deficiency in service’’. It added that Oriental had not furnished any evidence that the fees charged by the hospital were “not reasonable nor necessary or customary’’. It allowed the company to deduct the non-medical expenditure of Rs 110 but asked it to reimburse the remaining amount along with 9 per cent interest.