[SnS_12]

Originally Posted by blorebuddy

Thanks for sharing. I have gone through the similar experience and similar thought process of how my family would be able to follow up and fight with the insurance company to get the approvals. It's more of head ache than the benefit during the stressful time.

Insurance has to be considered as a protector of your savings or unexpected financial burden but many consider it as investment tool where they can get a benefit of few lacs by paying a few thousands in premium. So, if you’re financially well off mediclaim insurance is of no use as it doesn’t provide better healthcare in any anyway and chances are you will have a better experience at the hospital when you pay upfront as its less hassle for the hospital as well

Originally Posted by androdev

I have a family floater policy for 10L that I have been maintaining privately. I am not employed at the moment but if I do take up a job in future, what should I do? I don't want to discontinue this policy because the clock will reset and I will have to wait for some years to get cover for some diseases. However, I would prefer a company provided policy as that offers much better customer service and it would be a free employee benefit. My employment is not steady so I can't depend on policy provided by employer as i will have lot of employment gap years.

Wow. This is a revelation to me. I have been brainwashed to buy health insurance. I am paying 80K annually for a cover of 10L for donkey years. I'm just following the crowd but I often wonder why I'm paying this much for just 10L cover, why not save this and create my own corpus. 10L is not a life-changing amount especially if I'm paying 80K per year. I'm sure there must be a catch. I'm not very smart when it comes to these things. Maybe maintaining a cover for 10L can potentially reimburse 10L medical bills every year for an annual payment of 80K - is that the logic? Could you please share pros and cons of this approach? Thanks.

Sir, your S class suspension costs more than at and that is the reason why it makes no sense to buy such policies at such high premiums. The only benefit is some tax rebate on the premium paid and in case of prolong illness you may get a 10 lac benefit year on year but the premium would definitely go up year on year.

Since, you already have a ongoing policy for so many years it would not be advisable to cancel and just like sim cards medical policies can be ported to a new provider so instead of buying a base and top up you can look at a product called Optima Secure from HDFC ERGO. A colleague has bought a 20 lac floater cover where he in his mid 40’s and covers his wife and son. The main benefit is you can claim up to 80 lacs in a given year if required and the premium he pays is 28k.

Other policy benefits are as below and better to buy it through an agent so he can guide and help you during your hospitalisation and your family doesn’t have to worry about it.

[civic-dk]

Originally Posted by SnS_12

Insurance has to be considered as a protector of your savings or unexpected financial burden but many consider it as investment tool where they can get a benefit of few lacs by paying a few thousands in premium. So, if you’re financially well off mediclaim insurance is of no use as it doesn’t provide better healthcare in any anyway and chances are you will have a better experience at the hospital when you pay upfront as its less hassle for the hospital as well.

Attachment 2654508

This is the exact logic which I applied and decided to discontinue medical insurance policy where I was paying 20k for a family floater policy (for me and my wife) for a cover of 10 lakhs, since I already have 8 lakhs medical insurance cover from my organization until I retire. Post-retirement, this 10 lakh cover will be peanuts and I would be easily able to shell out this amount or more in case of any exigency.

Frankly, I have always felt medical insurance to be bit of a scam (bit extreme, but there it is ).

[SnS_12]

Originally Posted by civic-dk

Frankly, I have always felt medical insurance to be bit of a scam (bit extreme, but there it is ).

People don’t read the policy documents and the only time they understand the terms and conditions of the policy is unfortunately when a hospitalisation happens.

If you’re buying a policy don’t compare in terms of premium but the add ons and wider coverage that are available. Main cap most companies apply is on room rent especially for ICU wherein it will be capped to a percentage of the Sum Insured and not paid on actuals and these are things one pays out of pocket despite insurance and that is the experience they were not prepared for.

Ones Health and Wealth cannot be outsourced and one has to do their homework/research well to and make the right educated decisions in life.

[Su-47]

Originally Posted by SnS_12

Insurance has to be considered as a protector of your savings or unexpected financial burden but many consider it as investment tool where they can get a benefit of few lacs by paying a few thousands in premium. So, if you’re financially well off mediclaim insurance is of no use as it doesn’t provide better healthcare in any anyway and chances are you will have a better experience at the hospital when you pay upfront as its less hassle for the hospital as well

I was of the firm opinion that one should build a good corpus to take care of medical situations so as to not worry about numerous exclusions, limits and caveats.

But a recent experience makes me wonder if that is the indeed the right approach. Someone in the family had to get a small surgical procedure done and we thought it would be a hassle to claim insurance for it, so I asked the hospital for an estimate and it was ~1.55L. Since this wasn't a small amount, we went with insurance (cashless with pre-approval), and it was interesting to see that the insurance company only approved 1.04L, and the hospital accepted it. When I asked the hospital folks, they said that insurance companies have pre-negotiated rates for certain procedures. Would they have agreed if I offered the same price on my own -- I have no idea. But the thing is, I wouldn't have known that (a) it is negotiable and (b) what's the fair price of some surgical procedure.

So, I wonder if some hospitals may run amok with un-neccesaary tests and procedures for a "self-financed" hospitalization as they don't have to justify/explain the reason to anyone. The same may be a bit more difficult to pull-off for an insurance case as the insurance company will review the need for any expensive procedure. Perhaps I'm extrapolating quite a bit, so it would be interesting to know what people familiar with insurance/healthcare industry think of it.

[JediKnight]

Originally Posted by Su-47

So, I wonder if some hospitals may run amok with un-neccesaary tests and procedures for a "self-financed" hospitalization as they don't have to justify/explain the reason to anyone. The same may be a bit more difficult to pull-off for an insurance case as the insurance company will review the need for any expensive procedure. Perhaps I'm extrapolating quite a bit, so it would be interesting to know what people familiar with insurance/healthcare industry think of it.

My experience has been opposite. When they know you are on insurance they tend to ask for more tests, etc. I have seen this behavior in small hospitals. Am not sure this would happen in more reputable major hospitals.

[kavensri]

Originally Posted by JediKnight

My experience has been opposite. When they know you are on insurance they tend to ask for more tests, etc. I have seen this behavior in small hospitals. Am not sure this would happen in more reputable major hospitals.

Exactly the same experience for me as well. My mother is twice a cancer survivor and I don't even remember how many times she has been admitted to the hospital in her life. Many a times, I have been asked whether I have insurance or not. I have been told openly that the total bill be less if there is no insurance.
And just last week, one of my cousin got admitted to a hospital for a brain surgery. His son was told directly that the total bill would be around 2.5l if no insurance and it would be around 4.5l if he has insurance.

[SnS_12]

Originally Posted by Su-47

But a recent experience makes me wonder if that is the indeed the right approach. Someone in the family had to get a small surgical procedure done and we thought it would be a hassle to claim insurance for it, so I asked the hospital for an estimate and it was ~1.55L. Since this wasn't a small amount, we went with insurance (cashless with pre-approval), and it was interesting to see that the insurance company only approved 1.04L, and the hospital accepted it. When I asked the hospital folks, they said that insurance companies have pre-negotiated rates for certain procedures. Would they have agreed if I offered the same price on my own -- I have no idea. But the thing is, I wouldn't have known that (a) it is negotiable and (b) what's the fair price of some surgical procedure.

It’s quite possible that the insurance companies can have a tie up with such hospitals when claimed under cashless insurance just like bodyshops at service centres have rates fixed for their services used under an insurance claim.

But, there is a flaw in your calculation as you’re not considering the premium amount paid for the annual policy under which the claim amount of 1.04L was paid. That would be a fair comparison to know if you actually lost or gained by claiming under insurance.

Personally, my wife went underwent two surgeries last year and we were given a rough estimate on the expenses and even though a third surgery was required which was not planned for and an oncologist surgeon had to be called at the last minute the overall bill was still within the estimate provided, which wouldn’t have been the case if they knew insurance is going to pay for all the procedures.

[shankar.balan]

Originally Posted by civic-dk

This is the exact logic which I applied and decided to discontinue medical insurance policy where I was paying 20k for a family floater policy (for me and my wife) for a cover of 10 lakhs, since I already have 8 lakhs medical insurance cover from my organization until I retire. Post-retirement, this 10 lakh cover will be peanuts and I would be easily able to shell out this amount or more in case of any exigency.

Frankly, I have always felt medical insurance to be bit of a scam (bit extreme, but there it is ).

As one grows older one will inevitably have to pay a higher age-led premium for one’s medical insurance.

After a certain age, comprehensive medical tests are necessary before one receives the approval for medical insurance coverage.

This is why most regular people, buy and maintain their own personal medical insurance in parallel, alongside whatever policy the companies they work for, provide them with.

I think from the perspective of most of us who have now plodded into our 40’s and 50’s and who work for corporates/ companies, there has never been any guarantee of continuous employment.

It is therefore, simply an act of prudence to have ensured that we have an active personal medical insurance policy, so as not to fall victim to some random act of providence. The said policy may have been taken out in our mid to late ‘20’s or maybe ‘30’s.

None of us will easily trust the Government Hospitals and/ or avail of the nominal ‘Free’ medical care that they purport to offer. We have had no real option other than going private, right from the 1980’s.

Considering the frightening costs and highly inflated bills that we typically encounter nowadays in the world of private medical care (which is largely run by ‘Pharisees’ in the form of VC/ PE, there is no viable choice for us, other than to go for an Insurance coverage with a high sum assured (and pay its high premium along with the usurious 18% GST component), just on the off chance that one may need to invoke it sometime.

Buying Medical Insurance is a necessity in our country.

But it is also rather like Placing a Bet.

You’re betting that you’re going to get sick and face fat bills from a Gaggle of Doctors.

The Insurance Company is the Bookmaker who is offering you some kind of Odds that you won’t.

Me, I’ve just preferred to place that bet and pocket the Betting Slip.

[Axe77]

Regarding medical insurance, we took a family floater that has significant coverage, but it was on the assumption that if we continue it, they will provide it as long as we maintain continuity and will not refuse renewal if we come up with a long term disease (like Cancer etc). Can SNS or anyone else please confirm whether this assumption is correct. It significantly defeats the purpose if after years of paying premium, the medical insurer will pull out if and when a long term illness arises. Or for that matter ‘very significantly’ hike the premium at that juncture. If that was the case, I’d rather invest the entire premium in equities for 10 - 15 years and let that create my own health insurance cover / corpus.

Separately, in addition to above self obtained medical cover, whatever lifetime corpus we are creating we are assuming a small sub-bucket for general age related requirements, whether it be healthcare or softer nursing needs or sudden hospitalization where the medical insurance for any reason either doesn’t cover us fully or at all.

To Androdev’s point on the fund, I agree that the premium paid invested instead would create a similar corpus but I think that corpus would be a one time usage whereas the insurance company is covering you for the said amount on a “per year” basis. Again, I’d let any expert confirm whether that assumption is incorrect practically or otherwise, both almost 80 years old (79 and 78).

Coming to my own parents, my dad fortunately has 100% reimbursement since he worked in a PSU for the better part of his life. While he doesn’t get pension, this is a HUGE relief for him from ongoing medical support perspective. My mum on the other hand has an insurance policy but she’s not that happy. In my own assessments, I assume both parents plus my family as the necessary dependents but of course my dad’s office insurance cover is a big relief including when he has undergone hospitalizations and surgery as well.

Lastly, I recently heard of an Ayushman Bharat scheme that provides medical cover up to 5L for all senior citizens above 70 years of age, regardless of their income or status etc. This is excellent for many middle class senior citizens and will provide some respite from depleting savings in case of a medical exigency. This may be worth exploring - I only heard some snippets of it as secondary info from an elders group. Some info at this link.

[SnS_12]

Originally Posted by Axe77

Regarding medical insurance, we took a family floater that has coverage (up to 50L I think), but it was on the assumption that if we continue it, they will provide it as long as we maintain continuity and will not refuse renewal if we come up with a long term disease (like Cancer etc). Can SNS or anyone else please confirm whether this assumption is correct.

Lastly, I recently heard of an Ayushman Bharat scheme that provides medical cover up to 5L for all senior citizens above 70 years of age, regardless of their income or status etc. This is excellent for many middle class senior citizens and will provide some respite from depleting savings in case of a medical exigency. This may be worth exploring - I only heard some snippets of it as secondary info from an elders group.

The premium component depends on the risk factor so family medical history and age plays a huge role on deciding the premium by an insurance company. And if you happen to erode the sum insured on a year on year basis the premium component will definitely go up and they can even put in coverage restrictions. So, keep that in mind.

One has to understand that they are assuming coverage continuity for multiple decades which is never a given because even the best of companies in insurance can shut shop one fine day or merge into a new entity which stops offering the same cover. So, it is not advisable to depend on insurance 100% from a long term perspective. Case in point being just like corporate Group Mediclaim Cover (GMC) companies also offer Group Term Life (GTL) and they had a bad experience during Covid where even 3 to 4 cases was enough to ruin the claim ratio as premiums for these policies are lower than GMC and many companies refused to renew cover for a corporate so you can imagine what can happen to a individual if the claim ratio is continuously 100% year on year.

On Ayushman Bharat it is true that the government has extended it to everyone over 70 years of age but you have to keep in mind that its only for 5 lac cover and a Reliance hospital may not treat you under that scheme because the government won’t pay them there level of treatment cost they are used too. We reinsure the State of Jharkhand under that same scheme where 60lakh + families below the poverty line are covered up to 5 lacs for free in that scheme.

[whitewing]

Originally Posted by Axe77

Lastly, I recently heard of an Ayushman Bharat scheme that provides medical cover up to 5L for all senior citizens above 70 years of age, regardless of their income or status etc. This is excellent for many middle class senior citizens and will provide some respite from depleting savings in case of a medical exigency. This may be worth exploring - I only heard some snippets of it as secondary info from an elders group. Some info at this link.

The scheme seems to have very very low limits.
In its current form, not something one should base their healthcare planning.

Yes, it is better than nothing, but not of much use for middle class and above.
Dengue fever has a limit of Rs1800. Angioplasty has a ~40K limit.

See details of limits : https://pmjay.gov.in/sites/default/f...Website_V2.pdf

[Axe77]

Originally Posted by SnS_12

On Ayushman Bharat it is true that the government has extended it to everyone over 70 years of age but you have to keep in mind that its only for 5 lac cover and a Reliance hospital may not treat you under that scheme because the government won’t pay them there level of treatment cost they are used too.

Originally Posted by whitewing

The scheme seems to have very very low limits.
In its current form, not something one should base their healthcare planning.

Thanks both. Whitewing this is helpful to know. I guess what this basically implies is that at the rates the government is wiling to pay, most middle class folks may not want to get treated in those facilities maybe and will expect slightly more upscale facilities. Unless this pricing works in high quality government hospitals etc, not sure of that. (I rate hospitals like KEM etc very very highly on competence regardless of how they look and feel.

Goes to the point SNS made I guess. Practically won’t work out for most and the discussion here is around more robust long term planning for health insurance in the retirement context.

[Lobogris]

Originally Posted by civic-dk

This is the exact logic which I applied and decided to discontinue medical insurance policy where I was paying 20k for a family floater policy (for me and my wife) for a cover of 10 lakhs, since I already have 8 lakhs medical insurance cover from my organization until I retire. Post-retirement, this 10 lakh cover will be peanuts and I would be easily able to shell out this amount or more in case of any exigency. Frankly, I have always felt medical insurance to be bit of a scam (bit extreme, but there it is ).

Fully agree with you. Insurance is necessary for people who can’t afford to pay a few lakhs in medical bills when needed. If a person is earning, say, just 20k per month and has no savings, then he or she would find a bill of 5 lakhs to be crippling. However, a person with 1 crore in savings would be easily able to pay it. That’s why, for anyone with decent income and decent savings, self insurance is the best alternative. Just deposit 50k in your savings each year and within a few years, you would have enough to meet most exigences. People get frightened about not having insurance but fail to realise that most bills are less than 1 to 3 lakhs and the exposure is therefore small. Many of us have phones that cost as much and we are not worried about insuring them. I would rather take a risk of a few lakhs when necessary than a certain and guaranteed loss of 30 to 70k each year.

[am1m]

Originally Posted by Lobogris

People get frightened about not having insurance but fail to realise that most bills are less than 1 to 3 lakhs and the exposure is therefore small.

That's a good point, but we had an experience last year where 2 elderly parents fell ill at the same time and one passed away. Both had hospital stays. Just 3 months prior, another parent had an extended hospital stay. And 2 months post the passing away of one parent, I went in for planned surgery! (Planned, but would not have been wise to defer it for too much longer.)

Now I could certainly have paid all those bills out of pocket, it was affordable, but it would have pinched. A combination of my office insurance, my wife's and the personal family insurance we had taken covered all of this cashless. That was a relief and at least for us, the premiums paid were worth it.

Agreed this is probably a corner case. But in the case of elderly parents falling ill, it could happen together, if they are in the same age bracket. And if you consider most people have young children too at the same time as elderly parents, perhaps it makes sense to consider medical insurance.

Agree that most personal insurance is mis-sold and of not much use. It doesn't make sense to blanket buy an unsuitable policy just because it's an item to be ticked off the list. And as someone has already wisely said, never mix investment and insurance, you'll end up getting a bad deal on both!

But a carefully considered policy, that fits your needs and financial situation, it may be worth speaking to an advisor (who doesn't get a cut from selling the insurance product!) about that.

[V.Narayan]

Lot of views above questioning the worth of medical insurance. Of course all views are valuable and have some basis in reality and there are no perfect answers.

My wife and I have a medical cover of Rs 1.00 crore each per annum and another of the Rs 2.00 crores each for loss of limb, accidental disability, blindness, loss of hearing etc. Most insurance customers do not realize that medical insurance does not compensate you for acquired disability due to illness or accident. Our premium on the whole package is about Rs 3 lakhs and change per year.

In my head insurance is a safety net for the day when I maybe get hit by health issues and/or disability issues and/or loss of income issues.....the worst would be an and plus and! As a retired entrepreneur I am very conscious that incomes can go up and down and don't always move in a linear fashion which is the unspoken assumption of most employed folks. Insurance is for the day you get hit from all sides. Return on insurance is not a financial calculation that I paid Rs 50,000 as premium each year for 20 years but only needed reimbursement of Rs 300,000 over those 20 years. It is for the day when you need a medical cover of say Rs 800,000 and you have just lost your job. It is not a financial RoI situation at all.

You need a good reliable agent who will run around and get the paper work done when you are unwell. I have in some cases {for my late in-laws} done it myself and it really isn't a nuisance like some say it is. Insurance is for the day the proverbial cow dung hits the ceiling fan. It is not here to compete as an investment with equity, debt, real estate etc.

Our medical insurance is here for the day I am no longer alive and my wife needs significant medical cover and she is simply not financially literate to figure out what investments to liquidate to pay for the costs. This assumption that several on this thread make assumes that you are well enough, sane enough and conscious enough to liquidate a part of your investments at that crucial moment in the first place.

To each his own.