Considering the steep inflation in the medical industry, maintaining at least one health insurance has now become a necessity. There have been significant medical advancements in the last few years, but you need to pay the price for it.
However, health insurance policy acts as a protective shield to ensure efficient finance management during medical contingencies. However, every health plan comes with a set of rules and regulations and never offers 100% coverage in every sector during claim settlement. One such significant factor is the room rent capping. We will highlight how this clause works practically.
What is meant by room rent capping in health insurance?
The room rent capping in the health plan is the specific limit that is imposed on the amount that the concerned insurance provider is supposed to pay for hospital room charges per day during the hospitalisation of the policyholder. This means that if the charges exceed this pre-defined capping, the excess cost must be borne by the policyholder.
Every health insurance company mentions the specific room rent limit in the policy document for easy reference. It is often decided according to the amount of sum insured. In some cases, the specific amount of room rent cap is mentioned, while in some other plans, a particular percentage of room rent is mentioned based on the sum insured.
It usually revolves around 3% of the total sum insured. It can also be mentioned in the form of a specific amount of allowance per day. However, it may differ according to the terms of the specific plan concerned.
Types of room rent capping in health insurance
When it comes to room rent capping, every individual health insurance company maintains an exclusive approach. Considering the type of health plan chosen, various types of room rent caps are available:
Zero capping on room rent: Several health plans are available with zero room rent capping. The policyholder can flexibly choose any type of room according to comfort and necessity.
Room rent co-payment: Co-payment on room rent implies that you have to share a specific percentage of the total room rent cost and other associated expenses along with your insurance provider.
Capped room rent: Most insurance providers prefix a specific limitation on room rent beyond which they will not offer coverage. The policyholder must bear the excess amount.
Room rent capping on specific types of rooms: Here, the policyholder is offered the choice to select the type of room according to necessity and availability. If your health plan offers room rent capping, you can either choose a room that fits the capping limit or pay the excess amount by choosing a more expensive room considering your requirements.
Room rent waiver: You can separately purchase this rider along with your health plan with room rent capping. But, due to this rider, this limit will be automatically waived.
How does room rent affect your health insurance claim?
While calculating the claim amount during claim settlement, the insurance provider will principally consider the room rent and the capping limit as per applicability. The overall claim settlement amount is decided depending on your choice of room. If it is above the cap limit, you will have to co-pay the excess amount. However, if it remains within the limit, it will be covered by your insurer.
If the room rent caps at INR 2500 per day, and you choose a room costing INR 2000 per day, the entire room charge will be covered by the plan. However, if your room charges are INR 3500 per day, you have to settle the remaining amount out of your pocket.
Also, the additional costs are also related to the room type. So, if you opt for a room within the cap limit, then all linked costs like doctor fees, nurse charges, etc, would also be completely covered. However, if the room expenses are more than the sub-limit, then all costs would be calculated on a proportionate basis and the remaining amount would have to be borne by the policyholder.
Sub-limits on room rent
Health insurance companies often include sub-limits for minimising their liabilities while paying the policyholders. Any health plan without any sub-limit is considered to be more advantageous for the insurance holder. This sub-limit can be included in a plan as a specific percentage of the total amount of sum insured or mentioned as a fixed amount for particular types of medical costs and treatments.
Hospitals usually follow specific packages for variable room categories. If the health plan mentions coverage for a general room and the individual opts for a private room, then the excess amount must be settled by the policyholder.
You must remember that all the associated medical costs including nursing charges, doctor’s fees, etc. are directly proportional to the room charges. This means that they are more in the case of deluxe rooms than general rooms.
Benefits of health plans without room rent capping
It is always advantageous to enjoy the flexibility to choose any type of room according to your preferences, necessity, and availability. Some of the most significant benefits of having a health plan without any room rent capping are:
Flexibility: Without any room rent capping, you need not have to worry about finances irrespective of the type of room you select during hospitalisation.
Enhanced facilities: When you do not have any financial worries in this respect, you can always choose a better room with enhanced facilities. This may have a positive outcome on your overall recovery process.
Savings: Although it may seem like an oxymoron, a health plan without room rent capping can save you money. Several hospitals have specially discounted packages for patients who opt for higher-priced rooms. So, by choosing a deluxe room, you can eventually save on medicine costs, nursing charges, etc.
Peace of mind: If you do not have to worry about finances, it will have a positive impact on your recovery. It will retain your peace of mind.
Enhanced facilities: If you opt for a health plan without any room rent capping, you open the gates to enhanced medical facilities without much financial worry. It is especially crucial for more complicated health issues.
Conclusion
From the above discussion, it is clear how room rent capping affects your health insurance claim settlement. You must be aware of all the associated clauses, terms, and conditions of your chosen health plan to avoid any complications or misunderstandings during claim settlement.
These are finer issues and require proper clarification before further proceedings.
Recommended Link: Room Rent Limit - How it impacts your claim?
