Insurers can’t cite VMC guidelines to reject claims

Vadodara: With the new notification giving a protocol for admission of Covid-19 patients and inspection teams verifying if admissions were justified, many may be concerned about the fate of their medical insurances if the notification is made a ground for denying mediclaim.

But experts and lawyers say that insurance companies cannot turn down claims on such grounds.

“The civic body has only issued guidelines for regulating the availability of beds in such times. Since it is not a law, the insurance companies cannot use them for rejecting the claims,” said prominent lawyer Jaideep Verma.

“Insurance companies and their third-party administrators cannot use these guidelines. Even if they do, how can they deny the fact that the patient has taken the treatment at the hospital?” said Akhil Dave, another lawyer who takes up insurance claims related cases. “Also, the policy is an agreement between a person and insurer wherein the latter says that whenever the policyholder needs help, they are there,” he added. The policy’s terms and conditions also do not mention that guidelines issued by a body like VMC will be binding on it.

Time and again courts deciding insurance claim disputes have also stated that doctors are the authority on deciding the line of treatment and insurance company cannot challenge that. “Insurance companies may use the guidelines and reject the claims, but this justification will not stand in court,” said P V Moorjani, who runs a trust for consumer rights.

“However, the consumer courts have always said that the doctors will only decide the treatment and whether hospitalization is required or not,” he added. Lately, a majority of private hospitals in the state are declining cashless treatment facility for Covid-19 to mediclaim policyholders.

The hospitals on their part say that TPAs are delaying authorization letters as well as final settlements, which, even if approved are done with haphazard cuts in the final bills. As many as 20 approvals were put on hold by TPAs recently in Vadodara citing admission protocol notification that was issued by the Vadodara Municipal Corporation (VMC).

Source: The Times of India