IRDAI Makes It Mandatory For Health Insurance Companies To Cover Mental Illness From This Month

Despite a five-year-old law already in place that mandates the inclusion of mental health-related illnesses in insurance policies, not many health insurers had incorporated the provisions in India. But a fresh nudge from India¡¯s insurance regulator IRDAI has prompted insurers to ensure compliance this month onwards.

In a much-needed move to promote mental health especially after its importance cropped up amidst the Covid pandemic, the Insurance Regulatory and Development Authority (IRDAI) has directed insurance companies to cover mental illness and comply with the provisions of the MHC Act, 2017 without any deviation, on or by October 31, 2022, implying that November 2022 onwards, all health insurance policies must cover mental illness.

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For the uninitiated, the Mental Healthcare Act (MHC Act) 2017 states that every insurer needs to make a provision for medical insurance for the treatment of mental illness. Following this, in August 2018, IRDAI had already directed all insurance companies to comply with the provisions of the act and mandated that insurers must not discriminate between physical and mental ailments.

But industry insiders mentioned that although public sector undertaking (PSU) health insurance providers had made the provisions for offering cashless hospitalisation for mental ailments, many private health insurance products did not have the offering, though in some cases the provisions were made on request, as per a Money Control report.

Now, this fresh nudge from IRDAI is expected to bridge the gap and make all health insurers include mental illness in all their policies.

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What All Will Be Included?

Until last month, most of the basic health insurance policies did not provide cover to you or your insured family members in case of a mental illness. However, that is expected to change this month.

As not many people may not be aware of how this coverage will work, let us explain this new rule.

The IRDAI has mentioned that all health insurance policies must include mental illness diseases. The new guidelines will make sure that health insurance policies cover patients suffering from mental illness who were so far out of the ambit of health insurance coverage. This mandatory coverage means that the insurers will have to consider mental illnesses the same way as physical illnesses, both in the old and new policies. That means the insured person will be covered for hospitalisation and therapy expenses towards treatments of mental illnesses too.

As far as the kind of diseases to be covered, the new rules will call for holistic protection of a person¡¯s well-being via insurance - be it physical or mental. Diseases like depression, dementia, bipolar disorder and Alzheimer's shall be covered unless some specific exclusions are mentioned in the policy.

Also, your existing health insurance policies will also have this feature. Insurers can no longer simply reject new policy applications for people with mental illness, as per an ET report. Those who are already suffering from such illnesses can get a health insurance policy covering this aspect now. And if someone develops these illnesses after the policy purchase, the claim will be admissible in such conditions also.

So, if you have existing health insurance or are about to take one, remember that the IRDAI has made it mandatory for insurance companies to include mental health. So in case your insurance company hasn't included it yet, make sure you get it done as per the guidelines.

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India¡¯s Mental Health Burden

The World Health Organisation estimates that the burden of mental health problems in India is 2443 disability-adjusted life years (DALYs) per 10,000 population, and the age-adjusted suicide rate per 100 000 population is 21.1. The economic loss due to mental health conditions, between 2012-2030, is estimated at $1.03 trillion.

WHO also mentions that India¡¯s Mental Healthcare Act, of 2017 provides the legal framework for providing services to protect, promote and fulfil the rights of people with mental illnesses. These are in line with the United Nations Convention on Rights of People with Disabilities (UNCRPD).

Even as per UNICEF¡¯s report last year, a survey found that around 14% of 15 to 24-year-olds in India, or 1 in 7, reported often feeling depressed.

Also, a report released by WHO in June 2022 estimated that 1 in every 8 individuals worldwide suffers from a mental disorder, urging for immediate action to change mental healthcare. Mental health illnesses constitute 15% of the global disease burden, and India has one of the world¡¯s largest populations of people with mental issues in one shape or another, as per WHO.

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WHO¡¯s Framework For Mental Health

As per WHO, mental health promotion involves creating an environment, which promotes healthy living and encourages people to adopt a healthy lifestyle. Enabling an environment through national mental health policies and legal frameworks is imperative for the effective management of mental health disorders and for providing overarching directions for ensuring mental health promotion.

It also mentions that determinants of mental health include individual attributes such as the ability to manage one's thoughts, emotions, behaviours and interactions with others. In addition, social, cultural, economic, political and environmental factors have a role to play as do specific psychological and personality and genetic factors.

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