Considering the growing awareness of health insurance, people are looking to choose a health plan with adequate cover, so they can easily pay off the medical bills. There are various parameters that you need to consider before buying a plan, such as plan benefits, sum insured, type of plan, sub limit, co-payment, network hospitals, free medical check up, etc.
In this article, we would discuss about the room rent limit and how it would impact your health insurance claim.
Room Rent Limit
Room rent is a type of sub-limit clause, under which the insurance company covers the hospital room rent on a daily basis only up to a certain limit. For instance, if the room rent cap under the plan is Rs 3,500 per day and you opt to accommodate a room that costs Rs 5,000 per day, you will have to pay the difference of Rs 1,500 from your pocket.
A number of health insurance buyers are comfortable with the room rent limit. Usually, people have a perception that they only have to pay the excess room rent from their pocket. If, the excess room rent is Rs 1,500 per day and you stay in hospital for 6 days, you will have to pay Rs 9,000 on your own.
If you think that it is the only additional cost that you need to pay, then you are wrong.
Impact on Hospital Charges
In addition to the excess of room rent, hospital charges are linked to the type of room you have opted to get hospitalized. If, the doctor’s visit to a shared room costs you Rs 1,000, then a visit by the same doctor may be charged at say Rs 2,000, if you opt for a private room. It’s not justified, but that’s the truth.
Hospitals levy charges on the basis of your ability to pay. You are charged higher for the same medical or operational procedure, if opted for a private room. For instance, if staying in a twin-sharing room, a surgical procedure costs you Rs 20,000, however, the same procedure may cost you around Rs 35,000 to Rs 40,000, in case you opted for a private room.
Impact on Insurance Claim
As, the charges levied are linked to the type of room, you stay with, the medical bill tends to go higher, if you opt for a deluxe hospital room. In case, your health cover does not have any sub-limits, an insurance company just has to pay for all the covered expenses.
If you have a health cover with the sub-limits, the company will cover the medical expenses in proportion of the rent sub-limit to actual rent.
Suppose room rent limit in your health plan is Rs 3,500 per day and the actual room rent is Rs 5,000. You get hospitalized for 6 days and run up a bill of Rs 1.5 Lacs.
If you think that the insurance company will cover all expenses apart from excess room rent i.e., Rs 1.5 Lacs – 1500 * 6 days = Rs 1.41 Lacs. Actually, that’s not true. The reimbursed amount will be Rs 1.5 Lacs * 3500/5000, which equals to Rs 1.05 Lacs.
Even though, you had a sum insured of Rs 5 Lacs, you will be reimbursed an amount in proportion to the room rent. The bill amount to be borne by you is Rs 45,000.
Here, you can see the impact of choosing a room rent under the health policy that can be shocking for those who are not aware of this aspect.
Health plans without sub-limits come with higher premiums than those with it. Opting room rent sub-limit may help you to reduce the cost of health insurance, but at the time paying bills, the insurance company will cover the medical bills only in the proportion of the rent sub-limit and the rest of the amount, you need to pay on your own.
Ideally, you should buy a health insurance plan without room rent sub-limit, as it ensures comprehensive protection against medical expenses. If you are not able to afford a plan without sub-limit, don’t forget to read through its limitations and the extent of coverage available under such plans.