SC to Centre: examine why insurers not reimbursing entire Covid treatment cost

NEW DELHI: The Supreme Court on Wednesday took judicial notice of general complaints about insurance companies playing truant in reimbursing the full cost of Covid treatment and told the Union government to proactively look into the problem faced by citizens during the pandemic.

A bench of Chief Justice S A Bobde and Justices A S Bopanna and V Ramasubramanian told solicitor general Tushar Mehta to "take care of the insurance companies" who are allegedly slashing the reimbursement amount due to Covid patients. It has been the general complaint that the cost of Covid-19 treatment has risen because of an increase in the number of consumable items - from PPEs to face shields - by doctors, nurses and health workers but the insurance companies were not reimbursing the billed amounts for consumables by hospitals.

Mehta said that the Insurance Regulatory Authority has already issued strict instructions to all insurance companies that the entire cost of consumables has to be included in the Covid treatment. "The IRDA can be asked to ensure that no person seeking reimbursement o Covid treatment cost in hospitals is left high and dry," he said.

The CJI-led bench said, "At the time of pandemic, the insurance companies cannot adopt a hands-off approach, especially when people are facing hardship." These remarks came during the hearing of PILs filed by advocate Sachin Jain and others who sought capping of the cost of Covid treatment at hospitals across India. Appearing for association of private hospitals, senior advocate Harish Salve and Mukul Rohatgi said that the PILs appear to be sponsored by insurance companies to cut down on their reimbursement outgo, given the large number of patients seeking a higher reimbursement.

He said the Centre has issued a guideline on Covid treatment cost. "At present there are so many beds vacant in the dedicated Covid hospitals set up by the governments. One can understand that the hospitals will charge a lot when the number of beds is less than the requirement. The private hospitals are also hardpressed financially as the footfall of non-Covid patients is just 20% of the normal times."

The bench said it "more or less agreed with the Centre's guidelines on Covid treatment cost". However, it suggested to Mehta to explore the possibility of categorising cities in different tiers so as to keep the cost of Covid treatment comparatively low in smaller towns. "Afterall, capacity to pay is important," the bench said. SC asked all counsel to give suggestions to improve the Centre's guideline to Mehta within a week.