How to decode your health insurance claim settlement letter

Health insurance claim settlement letters often contain complex deductions that can significantly reduce the payout received by policyholders. Common reasons for these reductions include "Reasonable and Customary" (R&C) charges, where insurers only pay standard local rates; MoU discounts, which are pre-negotiated reductions between insurers and hospitals; and exclusions for consumables like syringes or gloves, unless specifically covered by the policy.

Other significant factors include denials based on a lack of "active line of treatment," where insurers claim hospitalization was medically unnecessary, or classifications of treatment as "experimental or investigational." Additionally, choosing a hospital room category higher than the policy entitlement can trigger proportionate deductions across various medical charges. In some cases, insurers may also claim "liability could not be ascertained" due to insufficient medical documentation.

To protect themselves, experts recommend that policyholders obtain detailed, itemized hospital bills and indoor case papers to scrutinize every charge. It is essential to understand specific policy wording, ask doctors for explanations of medical necessity, and challenge any deductions that lack a clear medical or contractual basis through the Insurance Ombudsman or consumer courts.

(Source：Mint)