Insurance Companies Must Honour Claims at all Hospitals: Delhi High Court

NEW DELHI: In a major relief for patients, the Delhi high court has ruled that insurance companies would have to honor claims by valid medical policyholders who have received treatment at any government-registered hospital. Cashless facilities must also be extended to all such hospitals.

The court, thus, has put an end to a system where health insurance companies and third party administrators (TPAs) insisted that a hospital had to be registered with them for patients to avail insurance claims. The insurers and TPAs also dictated which hospitals could extend the cashless facility.

The HC held that all patients were entitled to medical insurance, including cashless facility, as long as they held a valid medical claim policy and that the General Insurance Public Sector Association (GIPSA) – group of public sector insurance companies – could not insist that hospitals must be registered with them.

Though the current order was limited to patients seeking eye treatment, the court found fault with the very basis of GIPSA’s guidelines and the external system of “network hospitals” to exclude government-registered hospitals. It may, therefore, be applied to other treatments as well.

The order, an interim ruling, was passed by a bench of the Chief Justice Rajendra Menon and Justice Brijesh Sethi on May 31.