Mental Health Insurance Coverage Plan: Defination & Exclusions

Mental health issues have never been acknowledged or accepted in Indian society. But with an increasing number of public figures opening up about their mental illnesses, mental health awareness has increased. People’s perception of mental health issues is changing for the better.So far health insurance companies only provided cover for physical diseases and ailments, and hence mental illness was excluded from the policies. Keeping these issues in mind, the government passed the Mental Healthcare Act which was implemented in May 2018.According to this act, every insurer is obligated to offer medical insurance for mental illness. The act also stipulated that the provisions for coverage of mental treatment must be similar to that of any physical illness.

Insurance companies will have to follow the definition of mental illness as stated under the Act:"Mental illness means a substantial disorder of thinking, mood, perception, orientation or memory that grossly impairs judgment, behaviour, capacity to recognise reality or ability to meet the ordinary demands of life, mental conditions associated with the abuse of alcohol and drugs, but does not include mental retardation which is a condition of arrested or incomplete development of mind of a person, especially characterised by subnormality of intelligence."

Mental illnesses identified under the World Health Organisation's ICD (International Classification of Diseases) will be provided by mental health insurance coverage. Norms as ICD-10 and ICD-11 will be followed. For instance, schizophrenia is classified as a mental illness. The coverage will include diagnosis, medications, treatment, care and hospitalisation during the illness. This also includes 24-hour mandatory hospitalisation.

The Mental Healthcare Act, 2017 clearly excludes mental retardation. Mental illnesses related to the abuse of drugs and alcohol are included in the Act. However, this could be added under exclusions by insurance companies. Other factors such as waiting periods for mental illnesses will have to be evaluated for mental health insurance coverage.As per the National Mental Health Survey (2015-16), around 150 million Indians need treatment for mental illness. Patients and their families incur an approximate monthly expenditure of Rs. 1000 to 1500 on treatment and care.Besides, the World Health Organization (WHO) states India as among the most depressed countries in the world. The treatment for clinical depression includes medication, therapy sessions and, in some cases, hospitalisation. Therapy by a professional psychologist or psychiatrist is among the common treatments and costs around Rs. 1500 to 2000 per session.Considering the expensive treatments of mental illnesses, the Act is a huge step towards an individual's physical and psychological well-being. This Act has also raised the significance of mental illness on par with physical illness. And mental health insurance coverage will certainly provide relief to people suffering from mental illnesses.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.