Rajiv Saxena, a 32-year old techie from Bangalore, was looking to avail of health insurance coverage for his parents, aged 62 and 60 years, respectively. Deteriorating age and expensive medical treatments have increased health risks. Especially with the pandemic, Rajiv realizes that his parents should be covered under a health insurance plan. He found the following alternatives –
- Senior citizen health insurance plans
He found many companies offering senior citizen health insurance plans that covered older individuals specifically. Such plans allowed coverage benefits suitable for his parents’ coverage needs.
- Comprehensive health insurance plans
Now, under comprehensive plans, Rajiv had the choice of opting for separate health plans for both his parents or opt for a floater plan for both of them.
If he opts for separate individual health plans for his parents, the aggregate premium might be higher, but he would get exclusive coverage for both. A family floater with both his parents under the same plan would be more cost-effective. However, their coverage would be shared under the same umbrella coverage. So, Rajiv would need to choose wisely.
- Group health plans
There was also an option for Rajiv to include his parents under the Group Health Plan of his company.
This is where Rajiv got stuck as to:
Which health solution he should opt for his parents and why?
Let us decode this situation before concluding.
- Comprehensive plans usually provide a wider scope of coverage and higher sum insured levels than a group plan or individual senior citizen plans.
Tip: If Rajiv is looking for covering his parents under a high sum insured all-inclusive plan, he can opt for a floater policy covering his parents. - Senior citizen plans are more suitable for parents if they are aged above 60 years.
Tip: If your parents have never had any coverage before or have pre-existing ailments and need OPD coverage, this is a good option. - However, Rajiv has the option of choosing his company’s Group Health Plan for his parental coverage as well. There are some pros and cons of Group Health Plans.
Pros:
- Usually the most cost-effective option and
- Usually do not have a waiting period and cover most pre-existing ailments as well from day 1.
Cons:
- Coverage is available only as long as you are there in the group.
- Company policy can change at any time and it might not allow parents to be added to the policy.
- No customization of the policy is possible
Tip:
So, in case you are confident that your company’s health policy would not undergo a change, then you can opt for the Group Health Plan, provided the relevant benefits are covered under this plan.
Things to consider while opting for a health plan for your parents:
1. Parent’s Age
If you are also looking for a health insurance policy for your parents, you have the aforementioned alternatives depending on your parents’ age. In case your parents are above 65 years of age, you can avail of a comprehensive plan, but they might be expensive. If, on the other hand, your parents are much older, you can choose a senior citizen policy that is specifically designed for senior citizens which usually have co-pay involved.
2. Pre-existing Ailments
Health insurance plans usually do not cover pre-existing illnesses in the first few years of the policy during the waiting period, which ranges from 12 months to 48 months across plans, including senior citizen health plans.
So, if your parents have any pre-existing conditions like diabetes, hypertension, heart ailment, kidney, liver or lung condition or any other illness that has been diagnosed before the inception of the policy, you need to opt for plans that have a low pre-existing waiting period. A shorter tenure would ensure that your parents can avail themselves of quicker coverage for their pre-existing conditions and enjoy all-around protection.
3. Coverage requirement
Health insurance plans might restrict the level of coverage if you seek insurance for your parents, especially if they are quite old. Senior citizen plans usually have a limited sum insured.
If a premium is a concern, you can opt for super top-up health insurance plans along with your basic policy. Super top-up plans give additional coverage at very low premiums and help you boost the sum insured affordably.
Sum insured depends on the city you stay in, the type of hospital you would usually visit, the type of room you need, etc. The total hospitalisation cost depends largely on these factors!
4. Co-payment
Co-payment is usually applicable if your parents are aged 61 years and above. In such cases, a part of the claim is payable by the policyholder which is called co-payment.
For example, 10% co-pay would mean 10% of each and every claim needs to be paid by the policyholder. Choose a plan with the lowest co-payment ratio so that your out-of-pocket expenses reduce at the time of claims. You can read more about it here.
5. Room rent limit
A room rent capping might be imposed by health insurance plans, especially if you opt for a low sum insured. Senior citizen plans are usually low coverage plans, so it might have room rent caps, which limits the coverage. If you seek admission in a room which has a rent higher than the capped limit, your inpatient claims would be proportionately reduced.
For example, say the room rent is capped at Rs.5000 and you admit your parents in a room which has a rent of Rs.7500. Since the rent has exceeded the maximum limit, the claim payment would be proportionately affected.
If the room rent claim amounts to Rs.1 lakh, the insurance company would not pay more than (5000/7500 * 100,000) = Rs.66,666 – deductions, if any.
6. Limit on other coverage benefits
Like the room rent limit, health plans might impose a limit on other coverage benefits too, especially if your parents have an adverse medical history.
For example, there is a limit on cataract treatments. Moreover, some plans also impose a limit on domiciliary hospitalisation, AYUSH treatments, etc. There could be a waiting period for treatments like joint replacement surgeries, cataract, hernia, fistula, tonsillectomy, etc. which needs to be concerned, especially if there is a planned surgery.
7. OPD cover
Having OPD coverage for doctor’s consultations, investigations and the cost of medicine incurred on an outpatient basis might be helpful for older parents. This could be added as an additional benefit and is worth the effort.
8. List of cashless hospitals
This is another important list that you need to check, i.e. list of networked hospitals in the city where your parents stay which allow cashless treatments and is preferred by you and your parents for treatment.
Best health plans for parents as per this case.
Rajiv was considering these plans for his parents:
- Comprehensive floater plans
| Max Bupa Health Companion | ICICI Lombard Complete Health Insurance | |
| Sum insured | Rs.2 lakhs to Rs.1 crore | Rs.2 lakhs to Rs.50 lakhs |
| Entry age | No entry age restrictions | No entry age restrictions |
| Pre-existing waiting period | 2 to 4 years depending on the variant selected | 24 months |
| Room rent limit | No limit | No limit |
| Co-payment | None | None |
| OPD cover | Not available | Available |
| Cashless hospital network | 5700+ | 6500+ |
- Senior citizen health plans
| Star Senior Citizens Red Carpet Insurance Policy | Care Senior | |
| Sum insured | Rs.1 lakh to Rs.25 lakhs | Rs.3 lakhs to Rs.10 lakhs |
| Entry age | 60 to 75 years | Above 61 years |
| Pre-existing waiting period | 12 months | 48 months |
| Room rent limit | Applicable. The limit depends on the sum insured | 1% of the sum insured if the sum insured is Rs.3 lakhsFor higher sum insured levels- no limit |
| OPD coverage | Available | Not available |
| Co-payment | 30% for a non-PED claim and up to 50% for a PED claim | 20% per claim |
| Cashless hospital network | 10,200+ | 15,500+ |
If your parents are as fit as Rajiv’s parents without any pre-existing condition, you can also opt for a regular comprehensive floater plan. However, for PED coverage, you can opt for the one with the least waiting period. Additional benefits along with the plan are also deciding factors. Also, you can get an additional tax benefit U/S 80D for the health insurance premium that you pay. For your senior citizen parents, the tax benefit is up to Rs 50,000 a year.