Is treatment for Mental Health covered by Group Health Insurance policies?


psychometric treatment - vector image two people sitting and facing each other

Psychometrics refers to the field of psychology devoted to testing, measurement, assessment and related activities. Psychometric testing in psychology assists doctors in evaluating a patient’s learning, social, behavioral, and personality development. The results of the tests can help in treatment of the psychometric conditions of the patients.

Psychometric treatment is the treatment for mental illness or mental health issues arising due to any reason whatsoever. For example, there has been a substantial rise in mental health issues due to covid-19 pandemic where people were forced to sit at home which led to depression and anxiety.

It is important to know whether the psychometric treatments are covered in the group health insurance policies are not as these treatments are generally placed in the exclusion list. For a long time in India, health insurance policies did not cover mental illnesses as they were restricted to only physical illnesses. But now we are seeing a shift in this trend where the health insurance policies are also covering the psychometric treatments up to a certain limit of the sum insured.

The shift in the trend of the insurance companies can be attributed to the directions from the Insurance Regulatory and Development Authority of India which has made it mandatory for insurance companies to cover psychometric treatments. According to the guidelines of the IRDA, insurance companies have started offering health insurance plans covering mental illness as well. Certain companies, such as Max Bupa health insurance, ICICI Lombard general insurance, HDFC Ergo insurance, and Aditya Birla, have specifically introduced health insurance plans to cover people suffering from mental illnesses. These health insurance plans generally cover the in-patient hospitalization expenses for mental illness, but outpatient counseling and therapy are covered only if the policy mentions POD benefits. It is important to check the benefits offered by the health insurance policy before purchasing it.

One of the important provisions of the mental healthcare act, 2017 states that mental health illness should be included in health insurance coverage. Following this, the Insurance regulatory and development authority of India has asked the insurance companies to include coverage for mental health in their health insurance plans. The Mental Healthcare Act, 2017 defines mental illness as a considerable disorder in moods, perception, thinking, memory, or orientation that impacts their decision making, judgment, and behavior capabilities to meet ordinary day-to-day activities. The Act does not include mental retardation outside mental illnesses since it is primarily due to arrested or incomplete brain development.

There are many treatments required for mental illness such as medication, counseling, therapy, hospitalization etc. It is the duty of the customer to analyze the need for these treatments and take the health insurance policy accordingly.

These are divided into two sections, namely:-

  1. Inpatient hospitalization: It covers the hospitalization costs of the insured customer who requires hospitalization for mental illness, which may include therapy sessions.
  2. OPD- It covers the counseling expenses, therapy expenses, medication, etc.

The severity of mental health issues cannot be predicted at any point of time and it is therefore advisable to get the coverage appropriately to prevent any confusion in the later stages. This is why it is important to select the insurance company which offers the best coverage when it comes to mental illness treatments.

There are certain exclusions that are not covered under the health insurance policies pertaining to mental illness that are mentioned below:-

  1. Any type of mental retardation
  2. Mental illness arising out of drug, substance or alcohol abuse
  3. History of recurring mental illness

For more details on the psychometric treatments in health insurance policy please book a call with Ethika insurance broking to understand the psychometric test in psychology and the need for including them in the health insurance policy.

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Susheel Agarwal

Namaste. I'm Abhinay Nedunuru, a Fellow of the Insurance Institute of India with a passion to make insurance simple and crisp. I write on insurance and investment. I have a passion for teaching and training in particular to insurance. I'm currently doing my PhD from IIM in Management.