Do Govt Employees need Health Insurance ?

Saturday, October 31, 2009
This article is posted in Money Matters category and has 3 Comments so far.

health-insurance“Why should I go for a Health Insurance if I am a Government Employee?  I am already covered by either CGHS or Medical Attendance Rules.”  This may be your thought process when you start reading this article.

But the reality is in case of an unfortunate event like you or your family members had to be admitted in a good hospital for a medical treatment, the present health schemes such as CGHS or Medical Attendance Rules might not cover the entire medical expenditure as these schemes have a cap in the form of package or schedule rates.  And the net result is you will not be reimbursed with what you had actually paid to Hospital.  Will health Insurance schemes could come in handy at these kind of situations ?

Answer for this question may not be affirmative if you had asked this question last year.  Because till last year Government norms for claiming medical reimbursement and Health Insurance claim simultaneously was bit stringent as the total of reimbursement from the government and the health insurance claim shall not exceed the package rate prescribed by the Government.  In other words there was no additional benefit in taking a health insurance policy if you are a government employee.

However, this year this condition has been relaxed.  We can claim medical reimbursement from Government as well the hospitalization expenses from the Insurance Company, provided the total claim should not exceed the actual expenditure.

Click here to go through this earlier article on GConnect about Govt orders on claiming medical reimbursement as well as insurance claim

Be an early bird:

Also most people tend to think that Health Insurance is something that they need to think about only when they grow old.

However, the fact is Health insurance premium tends to increase with age – more the age, higher the premium. So insure at a young age.  So that your insurance gets fixed at a low cost and by the time you grow old and the money become dearer, your insurance premium cost will be almost negligible.

Stay insured:

The other truth is that health insurance protects you in case you become seriously ill or meet with an accident. A sudden accident, loss of health or natural disaster can happen to anyone. Such situations can drastically alter a person’s life, causing loss of income and inability to pay bills.  So, it makes sense to stay insured

Cost of Health Insurance:

A health insurance policy not only covers the cost of financial losses when disaster strikes, but also helps you tide over emergency medical bills due to hospitalization. If you think your health insurance premium is expensive, just wait till you receive a medical bill.

Even if someone is down with jaundice or malaria and requires hospitalization for a couple of days, his hospital bill could range from anywhere between Rs 15,000 and 25,000 depending on the hospital. And in these days of rising health care costs, imagine a chronic diabetic who needs insulin injections everyday, some one who needs frequent dialysis/chemotherapy or someone who needs continuous medication to keep living.

While taking a survey of the Health Insurance premium cost, we just found that at a cost ranging from Rs. 100 to Rs 200 per member per month, a family consists of 4 members viz., husband in the age of 40, wife in the age of 36 and two kids in the age of 12 and 7, could be covered with the health insurance benefits of Rs.2 lakhs per year.  The following is the chart containing premium cost per year for a sum assured amount of Rs.2 lakhs for the family consists of 4 members as narrated above.
health-insurance-1
Please note that this is not a campaign to the insurance companies mentioned in the chart.  There may be other insurance companies which could offer good rates than the premium cost mentioned in this chart. This is just an indication to emphasize that insurance premium costs are affordable.  Readers are advised to verify the health insurance schemes offered by various companies before choosing the right one that suits them.


What are the other benefits of taking a Health Insurance policy?

The immediate benefit of taking up a Health Insurance policy is the Tax benefit that you can enjoy under section 80 D of the Income Tax Act.

Do not worry if you do not have adequate money to pay for sudden hospitalization or surgery. Your health insurance policy offers a cashless hospitalization facility. This facility is a great help since one doesn’t have to run around in the middle of the night to collect cash for paying up large deposits prior to admission.

If a person gets hospitalized all his medical expenses 30 days prior to hospitalization and 60 days post hospitalization will be covered. This includes nursing expenses, diagnostic and medical expenses, surgery, anesthesia cost, doctor’s expense, specialist fees, scanning, x-ray, ambulance expense, oxygen, operation theatre expenses, and cost of surgical appliances, room expenditure, day care expense and similar expenses.

There are few treatments which due to technological advancement are done as an outpatient, that is, you need not have prolonged hospitalization. These treatments are also covered under health insurance.

Reduced Health Insurance Cost over the period if no claim now:

If you are a non-claimant don’t think that your money is wasted. In fact, a Health Insurance policy is most advantageous to you when you do not claim for the first few years and stay insured continuously. You will not only enjoy the Income tax benefits under Section 80D of the IT Act, but also your sum insured gets increased without paying any extra premium by way of cumulative bonus. Or you can keep the sum assured constant and start paying lesser premium.


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3 Responses to “Do Govt Employees need Health Insurance ?”

  1. RAJIV PATHAK said on Saturday, October 31, 2009, 16:43

    Sh.Ghulam Nabi Azad,
    Hon`ble Union Minister,
    Ministry of Health and Family Welfare,
    1st Floor, Nirman Bhawan, New Delhi.
    E-mail : azadg@sansad.nic.in

    The Secretary,
    Ministry of Health and Family Welfare(CGHS),
    Nirman Bhawan, New Delhi.

    Subject:- Request for revising the procedure for Central Government Health Scheme Beneficiaries (i.e. For Both Serving Government Servants and Retired Pensioners / Family Pensioners) for Medical Treatment in a Recognized CGHS Empanelled Private Hospitals of their choice for all Governments Servants / officials of Government of India.

    Respected Sir,

    I wish to bring to your kind attention the difficulties being faced by all the groups of Governments Servants / officials of Government of India. i.e. the Beneficiary’s of Central Government Health Scheme (i.e. For Both Serving Government Servants and Retired Pensioners/Family Pensioners) for taking Medical treatment in CGHS Recognized/ empanelled private Hospitals of their choice. They cannot directly visit the CGHS Recognized/ empanelled private Hospitals of their choice without being first asked to going to a Government Hospital and than to a CGHS recognized Hospital. The purpose of providing timely and urgent Medical treatment available/accessible to the patients of a Government servants under the CGHS Scheme is totally defeated when the government servant is made to run from one organization to another before any Medical treatment in CGHS Recognized/ empanelled private Hospitals of their choice could be started for his patient. Without obtaining any permission for Medical Treatment, he cannot go to any CGHS Recognized/ empanelled private Hospitals of their choice. And by the time, the government servant is successful in obtaining permission from any CGHS Recognized/ empanelled private Hospitals of their choice, he is already so exhausted to the core, that he does not have that extra stamina left to fight the dreaded disease.

    The initial procedure for taking the medical treatment from CGHS recognized hospital/ Empanelled Private Hospitals of his choice is very long and time consuming. Firstly, the patient is required to visit the Government Hospital for consultation and for medical treatment with the Specialist of the disease after being referred from a CGHS dispensary. When the required prescription/line of treatment has been obtained in the form of a prescription from a Government Hospital Specialist, he is required to apply for obtaining the required permission from his office for taking the required treatment from the recognized CGHS hospital of his choice. This step is time consuming for the Patients of the group B and c governments and the Patient have to undergo unnecessary delay in getting the benefit of treatment directly from a CGHS recognized hospital/ Empanelled Private Hospitals of his choice. They are unnecessarily made to run to Government Hospitals, even though there are prescribed CGHS recognized hospital/ Empanelled Private Hospitals declared by the Government of India.

    In the case of Specially Pensioners the Method for obtaining Permission from a CGHS Dispensary is very unique. In case of a Pensioners, when they obtain the required permission from the CGHS Dispensary for once visiting the CGHS recognized hospital/ Empanelled Private Hospitals of his choice, than again the Pensioner is required to go back to the same Government Hospital for obtaining further Prescription for the follow-up action and then revert back again to the CGHS Dispensary for further obtaining the required Permission .In this way the Pensioner is being harassed time and again and in a way forced withdraw his approaches to the CGHS Dispensaries / Government Hospitals for his Medical Treatment on regular basis from the CGHS recognized hospital/ Empanelled Private Hospitals of his choice. I hope the Department of CGHS and the Ministry of Health and Family Welfare would sympathetically look into the matter and resolve the crisis for all times.

    In view of the circumstances mentioned above, I would be grateful, necessary steps are taken by the Government to simplify the procedure by doing away with the procedure of first obtaining the prescription for the line of treatment from a Specialist of a Government hospital. The Patients of all the governments servants may be allowed to straight away approach the CGHS recognized Hospitals / Empanelled Private Hospitals of his choice, directly and then he may be asked to inform his office in writing, that he has opted to take the Medical treatment from the particular CGHS recognized/ Empanelled Private Hospital of his choice, so that the medical reimbursement expenses could be paid to the government servant by his office.

    I would be grateful, kind consideration is given by your office for taking urgent action in the matter with recommendations to the Ministry of Health for redrafting and revising the Government Policy of Medical Treatment of CGHS Beneficiary’s (i.e. Both Serving Government Servants and Retired Pensioners/Family Pensioners) under the Central Government Health Scheme for CGHS Recognized Private Hospital/ Empanelled Private Hospitals of his choice for all groups of Central Government servants. These Government servants may be allowed credit facilities immediately by the CGHS Recognised Private Hospital/ Empanelled Private Hospitals once he visits them and allowed to undergo Medical treatment continuously till he is required to attend the hospital for curing his disease.
    Thanking you.
    Kindly acknowledge receipt.
    Yours faithfully,
    (RAJIV PATHAK)

    Reply

  2. padmanabhan said on Saturday, October 31, 2009, 18:10

    sir, as your covered all important point like important of MI (Medical insurance) and need to be committed all the year. For CGHS beneficiers CG govt. modified scheme. hope this will follow to other CG employees also. MI is not tax purpose only. Govr. servant’s can claim is restricted to his Class but in MI it is based on his premium. also bank offer floater system where in total amount per year can be adjusted towards totL BENEFIT. THIS IS NOT AVAILABLE from std. MI policies. Insurance providers charge per person per year which can not be adjusted. in floater MI given by banks the total claim can be interconnected within the family.
    thank you yours sincerely V.Padmanabhan VCRC Pondicherry

    Reply

  3. D. Suresh Baburaj said on Friday, November 6, 2009, 16:52

    Sir,
    I had a coronary attack in 2006 and had 2 stents kept. My total expenditure worked out to Rs. 3.62 lakhs, but the medical reimbursement I got as per central government package was Rs. 1.55 lakhs (less than 50%). At least now the rules have been liberalized. Thanks. D. Suresh Baburaj.

    Reply

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