Login

New User / Forgot Password

Welcome

Change Login

Change Password

Edit Profile

Logout

Register

By logging in you agree to our Terms and Conditions and Privacy Policy

  • call us +91-022-35000600 - 35000629
  • Login
  • Help
  • Home
  • Know Us
    • About Us
    • Photo Gallery
    • Awards
    • Certificates
    • Client Testimonials
  • Our Services
    • My Portfolio
    • Calculators
    • eGreetings
  • Our Products
    • Life Insurance
    • Mutual Funds
      • Top Performing Funds
      • Dividend Declared
      • New Funds Offer
      • Search Funds
    • Health Insurance
    • Personal Accident
    • Travel Insurance
    • Motor Insurance
    • FD's & Bonds
    • Small Savings
  • Useful Information
    • Tax Info
    • Articles
    • Industry News
    • Learning Center
      • Tax Guide
      • Insurance Guide
      • FAQs
      • Glossary
    • TPA
    • Video
  • Downloads
    • Forms
    • KYC Forms
    • General Forms
  • Reach Us
    • Social Network
    • Contact Us
Home » Information » Industry News Details
back
Share
Tweet
Industry News

Own a health insurance policy with room rent sub-limits? Hospital room GST will pinch
25-Jul-2022
Read More News

The recently introduced 5 percent Goods and Services Tax (GST) on hospital rooms, excluding intensive care units, with a rent of over Rs 5,000 will inflate healthcare costs for patients.

Health insurers are likely to treat this tax as part of the total bill amount, but policyholders who own plans with room rent sub-limits will be affected. “Health insurance policyholders are unlikely to be affected, as the insurer will typically pay the claim as applicable (including the GST charges) to the insured if the policy has no capping on the room rent,” says Nikhil Kamdar, Appointed Actuary, Digit Insurance.

Overall health insurance premiums across age groups could also go up further. “From a policyholder’s point of view, this will also result in higher premiums as room rent accounts for 15-20 percent of the overall hospital bill,” says Biresh Giri, EVP, Actuary and Underwriting, ACKO Insurance.

Higher effective room rent due to GST will mean higher out-of-pocket expenses for policyholders who have policies with room rent sub-limits and proportionate deduction clauses.

“Earlier, healthcare was out of the GST ambit. The 5 percent levy on hospital room rent will push up the cost of hospital stay for policyholders who have health insurance policies with the room rent sub-limit clause. This, despite the fact that insurance companies are likely to pick up the GST tab,” says Satish Gidugu, CEO and Whole Time Director, MediAssist TPA.

This is because of the proportionate deduction clause in such health insurance policies. “Since all other charges (such as consultation fee, and operation theatre charges) are linked to room rent, the overall bill will be inflated. And, the entire eligible claim amount will get reduced proportionately,” he adds.

Patients who do not prefer smaller hospitals or shared rooms could face a higher out-of-pocket burden. “When a medical condition necessitates hospitalization, most people prefer larger multi-specialty hospitals, where room rent is way higher, resulting in increased cost of hospitalization, including a higher GST bill,” says Giri.

Usually, the room rent is capped at 1-2 percent of the sum insured. For example, the standardized Arogya Sanjeevani health policy specifies a limit of 2 percent of the sum insured or Rs 5,000 a day, whichever is lower. Then, there are policies where the holders are eligible for single private rooms and ones that do not specify any limit at all.

The proportionate deduction clause

Health insurance policies with room rent restrictions are cheaper than those without any limits. However, if you own such policies, the claim amount paid to you will be lower than the actual bill amount because of this clause that goes hand-in-hand with the sub-limits.

If your room rent exceeds the limit specified, your approved claim amount, which also includes doctors’ fees, operation theatre charges, etc, will be scaled down proportionately.

For example, suppose your health cover is Rs 5 lakh and the room rent sub-limit is 1 percent (that is, Rs 5,000) of the sum assured. But, you end up getting hospitalized in a room with a daily rent of Rs 6,000 and your final bill comes to Rs 1.5 lakh. Now, though your bill amount is less than the sum insured, you may have to shell out up to Rs 30,000 from your pocket because of the proportionate deduction clause. The insurer could approve a claim of only Rs 1.2 lakh, in line with the room rent sub-limit clause in your policy.

As the room rent was 20 percent higher than the policy cap, the claim amount for the linked expenses would be proportionately reduced by 20 percent. This calculation does not factor in expenses payable at actuals or not linked to the room rent.

What can policyholders do?

For one, you can buy or port to policies without sub-limits, provided your budget permits it and insurers accept your proposal. This is because those in older age–groups or with adverse health history may find it difficult to buy such policies at affordable premiums.

 

“Most of the health insurance plans that are sold in the market today have no room rent capping. This means that the policyholder can get any room of their choice in the hospital for the treatment without any maximum room rent limit,” says Amit Chhabra, Head, Health Insurance, Policybazaar.com.

Therefore, those who have restriction-free policies need not worry. “For new customers, it is advisable to buy a policy which has a single private room capping at least and not a policy which says that your coverage for room rent expense is restricted to Rs 5000,” he adds.

Do note that while a single private room may seem like a solution, it may not necessarily be the case. For instance, if your policy specifies single private room non-deluxe but your hospital only has deluxe or suite rooms vacant, you will have to the proportionate deduction clause to face.
Source : Money Control back
×
Disclaimer of Warranties
You expressly agree the use of the service is at your sole risk. The service is provided on an "as is" and "as available" basis. www.rkshetty.com expressly disclams all warranties of any kind, whether express or implied, including, but not limited to the implied warranties of merchantability, fitness for a particular purpose and non-infringement . www.rkshetty.com makes no warranty the services will meet your requirements, or the services will be uninterrupted, timely, secure, or error free. Nor does www.rkshetty.com make any warranty as to the results that may be obtained through the service or that defects in the software will be corrected. You understand and agree any material and/ or data downloaded or otherwise obtained through the use of the service is done at your own discretion and risk and you will be solely responsible for any damage to your computer systems or loss of data that results from the download of such material and/ or data. www.rkshetty.com makes no warranty regarding any goods or services purchased or obtained through the service or any transactions entered into through the service. No advice or information, whether oral or written, which you obtain from www.rkshetty.com or through the service shall create any warranty not expressly made herein. You acknowledge that www.rkshetty.com site may contain links to other web sites operated by third parties ("linked sites"). You acknowledge that, when you click on a link to visit a linked site, a frame may appear that contains the www.rkshetty.com logo, advertisements and/ or other content selected by www.rkshetty.com. You acknowledge that www.rkshetty.com and its sponsors neither endorse nor are affiliated with the linked site or any link contained in a link site, or any changes or updates to such sites. You also acknowledge that www.rkshetty.com is providing these links to you only as a convenience. www.rkshetty.com does not endorse in anyway any advertisers/ contents of advertisers on its webpages. Please therefore verify the veracity of all information on your own before undertaking reliance and actioning thereupon. www.rkshetty.com shall not be responsible nor liable for any consequential damages arising on account of your relying on the contents of the advertisement.
Privacy Policy
This site is the responsibility of www.rkshetty.com

We want you to

  • feel comfortable using our web sites
  • feel secure submitting information to us
  • contact us with your questions or concerns about privacy on this site
  • know that by using our site you are consenting to the collection of certain data
What Information is, or may be, collected from you?

We will collect certain anonymous information in standard usage logs through our Web server, including: computer-identification information obtained from "cookies," sent to your browser from a

  • web server and stored on your hard drive
  • an IP address, assigned to the computer which you use
  • the domain server through which you access our service
  • the type of computer you're using
  • the type of web browser you're using
We may collect the following personally identifiable information about you:

  • name
  • email address
  • ZIP/Postal code
  • demographic profile (like your age, gender,occupation and education);
  • financial information (like annual income or insurance policy number); and
  • opinions of features on our websites.
Who collects the information?

We will collect anonymous traffic information from you when you visit our site

We will collect personally identifiable information about you only as part of a voluntary registration process.

Our advertisers may collect anonymous traffic information from their own assigned cookies to your browser

The Site contains links to other Web sites. We are not responsible for the privacy practices of such Web sites

We offer a collection of online services which are available to you. Please understand that any information that is disclosed in these areas becomes public information. We have no control over its use and you should exercise caution when disclosing your personal information to anyone

How's the information used?

We use personal information to:

  • help us provide personalized features
  • tailor our sites to your interest
  • get in touch with you when necessary
We use contact information internally to:

  • direct our efforts for product improvement
  • contact you as a survey respondent
  • notify you if you win any contest; and
  • send you promotional materials
Generally, we use anonymous traffic information to:

  • remind us of who you are in order to deliver to you a better and more personalized service from both an advertising and an editorial perspective
  • recognize your access privileges to our Web sites
  • make sure that you don't see the same ad repeatedly
  • help diagnose problems with our server
  • administer our Web sites
  • track your session so that we can understand better how people use our sites
With whom will your information be shared?

We will not disclose any of your personally identifiable information to third parties unless:

  • we have your permission
  • special circumstances such as compliance with legal authorities
  • require disclosure
We will not use your financial information for any purpose other than to provide services to you.

What choices are available to you regarding collection, use and distribution of your information?

Supplying personally identifiable information is entirely voluntary. You are not required to register with us in order to use our site. However, we offer some services only to visitors who do register.

Upon request, we will remove your personally identifiable information from our database, thereby canceling your registration.

If we plan to use your personally identifiable information for any commercial purposes, we will notify you at the time we collect that information and allow you to opt-out of having your information used for those purposes.

All sites that are customizable require that you accept cookies. You also must accept cookies to register as someone for access to some of our services. e.g Online Portfolio. For information on how to set your browser to alert you to cookies, or to reject cookies, go to http://www.cookiecentral.com/faq/.

What security procedures are in place to protect information from loss, misuse or alteration?

To protect against the loss, misuse and alteration of the information under our control, we have in place appropriate physical, electronic and managerial procedures. For example, our servers are accessible only to authorized personnel.

Although we will endeavor to safeguard the confidentiality of your personally identifiable information, transmissions made by means of the Internet cannot be made absolutely secure. By using this site, you agree that we will have no liability for disclosure of your information due to errors in transmission or unauthorized acts of third parties.

Policy Updates

We reserve the right to change or update these policies at any time upon reasonable notice, effective immediately upon posting to this site.

Disclaimer Privacy Policy Contact Us Feedback Search the Site Sitemap

© 2018 All rights reserved | www.rkshetty.com

Disclaimer of Warranties
You expressly agree the use of the service is at your sole risk. The service is provided on an "as is" and "as available" basis. www.rkshetty.com expressly disclams all warranties of any kind, whether express or implied, including, but not limited to the implied warranties of merchantability, fitness for a particular purpose and non-infringement . www.rkshetty.com makes no warranty the services will meet your requirements, or the services will be uninterrupted, timely, secure, or error free. Nor does www.rkshetty.com make any warranty as to the results that may be obtained through the service or that defects in the software will be corrected. You understand and agree any material and/ or data downloaded or otherwise obtained through the use of the service is done at your own discretion and risk and you will be solely responsible for any damage to your computer systems or loss of data that results from the download of such material and/ or data. www.rkshetty.com makes no warranty regarding any goods or services purchased or obtained through the service or any transactions entered into through the service. No advice or information, whether oral or written, which you obtain from www.rkshetty.com or through the service shall create any warranty not expressly made herein. You acknowledge that www.rkshetty.com site may contain links to other web sites operated by third parties ("linked sites"). You acknowledge that, when you click on a link to visit a linked site, a frame may appear that contains the www.rkshetty.com logo, advertisements and/ or other content selected by www.rkshetty.com. You acknowledge that www.rkshetty.com and its sponsors neither endorse nor are affiliated with the linked site or any link contained in a link site, or any changes or updates to such sites. You also acknowledge that www.rkshetty.com is providing these links to you only as a convenience. www.rkshetty.com does not endorse in anyway any advertisers/ contents of advertisers on its webpages. Please therefore verify the veracity of all information on your own before undertaking reliance and actioning thereupon. www.rkshetty.com shall not be responsible nor liable for any consequential damages arising on account of your relying on the contents of the advertisement.
Privacy Policy
This site is the responsibility of www.rkshetty.com

We want you to

  • feel comfortable using our web sites
  • feel secure submitting information to us
  • contact us with your questions or concerns about privacy on this site
  • know that by using our site you are consenting to the collection of certain data
What Information is, or may be, collected from you?

We will collect certain anonymous information in standard usage logs through our Web server, including: computer-identification information obtained from "cookies," sent to your browser from a

  • web server and stored on your hard drive
  • an IP address, assigned to the computer which you use
  • the domain server through which you access our service
  • the type of computer you're using
  • the type of web browser you're using
We may collect the following personally identifiable information about you:

  • name
  • email address
  • ZIP/Postal code
  • demographic profile (like your age, gender,occupation and education);
  • financial information (like annual income or insurance policy number); and
  • opinions of features on our websites.
Who collects the information?

We will collect anonymous traffic information from you when you visit our site

We will collect personally identifiable information about you only as part of a voluntary registration process.

Our advertisers may collect anonymous traffic information from their own assigned cookies to your browser

The Site contains links to other Web sites. We are not responsible for the privacy practices of such Web sites

We offer a collection of online services which are available to you. Please understand that any information that is disclosed in these areas becomes public information. We have no control over its use and you should exercise caution when disclosing your personal information to anyone

How's the information used?

We use personal information to:

  • help us provide personalized features
  • tailor our sites to your interest
  • get in touch with you when necessary
We use contact information internally to:

  • direct our efforts for product improvement
  • contact you as a survey respondent
  • notify you if you win any contest; and
  • send you promotional materials
Generally, we use anonymous traffic information to:

  • remind us of who you are in order to deliver to you a better and more personalized service from both an advertising and an editorial perspective
  • recognize your access privileges to our Web sites
  • make sure that you don't see the same ad repeatedly
  • help diagnose problems with our server
  • administer our Web sites
  • track your session so that we can understand better how people use our sites
With whom will your information be shared?

We will not disclose any of your personally identifiable information to third parties unless:

  • we have your permission
  • special circumstances such as compliance with legal authorities
  • require disclosure
We will not use your financial information for any purpose other than to provide services to you.

What choices are available to you regarding collection, use and distribution of your information?

Supplying personally identifiable information is entirely voluntary. You are not required to register with us in order to use our site. However, we offer some services only to visitors who do register.

Upon request, we will remove your personally identifiable information from our database, thereby canceling your registration.

If we plan to use your personally identifiable information for any commercial purposes, we will notify you at the time we collect that information and allow you to opt-out of having your information used for those purposes.

All sites that are customizable require that you accept cookies. You also must accept cookies to register as someone for access to some of our services. e.g Online Portfolio. For information on how to set your browser to alert you to cookies, or to reject cookies, go to http://www.cookiecentral.com/faq/.

What security procedures are in place to protect information from loss, misuse or alteration?

To protect against the loss, misuse and alteration of the information under our control, we have in place appropriate physical, electronic and managerial procedures. For example, our servers are accessible only to authorized personnel.

Although we will endeavor to safeguard the confidentiality of your personally identifiable information, transmissions made by means of the Internet cannot be made absolutely secure. By using this site, you agree that we will have no liability for disclosure of your information due to errors in transmission or unauthorized acts of third parties.

Policy Updates

We reserve the right to change or update these policies at any time upon reasonable notice, effective immediately upon posting to this site.

Know Us

  • About Us
  • Photo Gallery
  • Certificates
  • Awards
  • Client Testimonials

Useful Information

  • Tax Info
  • Articles
  • Industry News
  • Learning Center
    • Tax Guide
    • Insurance Guide
    • FAQs
    • Glossary
  • TPA
  • Video Gallery

Our Products

  • Life insurance
  • Mutual Funds
    • Top Performing Funds
    • Dividend Declared
    • New Funds Offer
    • Search Funds
  • Health Insurance
  • Personal Accident
  • Travel Insurance
  • Motor Insurance
  • FD's & Bonds
  • Small Savings

Our Services

  • My Portfolio
  • Calculator
  • eGreetings

Downloads

  • Forms
  • KYC Forms
  • General Forms

Reach Us

  • Social Network
  • Contact Us

Keep in Touch

All Rights Reserved © 2018 www.rkshetty.com

  • Disclaimer
  • Privacy Policy
  • Contact Us
  • Feedback
  • Search the site
  • Site Map