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Despite legal provisions, mental health coverage in India remains underutilized and poorly implemented, highlighting the need for policy corrections, increased awareness, and stricter regulatory enforcement.
Low Mental Health Claims Despite Legal Mandate
- Less than 1% of total health insurance claims in India are for mental health treatment.
- IRDAI mandates insurers to cover mental illness under the Mental Healthcare Act (MHCA), 2017, yet claims remain minimal.
Key Findings from the Mental Health Report 2025
- Conducted by Marsh McLennan India and Mpower (Aditya Birla Education Trust).
- 42% of survey participants were either unaware of their mental health coverage or did not have it.
- Exclusions in Policies:
- Addiction treatments and rehabilitation centres are not covered.
- Patients who attempt suicide often face claim rejections.
- Some physical health claims are denied if the patient is on psychiatric medication.
Real-World Challenges in Claim Approvals
- Psychiatrist Dr. Harish Shetty noted that most patients struggle to get claims approved due to lack of awareness and hospital clarity.
- Example: A heart attack patient’s insurance claim was rejected because he was on psychiatric medication.
Violations of Mental Healthcare Act (MHCA), 2017
- MHCA Section 21 (4) mandates equal insurance coverage for mental and physical illnesses.
- Indian Journal of Medical Ethics (Nov 2024) Analysis:
- Reviewed 268 health insurance policies from 2020-21.
- 6 policies (2 providers) explicitly excluded mental illness—violating MHCA and IRDAI guidelines.
- 224 policies excluded claims related to attempted suicide or self-injury.
- 267 policies denied coverage for injuries from alcohol or substance use.
- Only 23 policies included outpatient mental health services.
Implications and Way Forward
- Need for Awareness: More efforts are required to inform policyholders about mental health coverage.
- Policy Reforms: Strict enforcement of MHCA guidelines to prevent wrongful exclusions.
- Holistic Coverage: Expansion of insurance benefits to include outpatient mental health services, addiction treatment, and crisis intervention.
