In the unfortunate instance, you or a loved one is in the hospital, there’s a lot on your mind already. This is why the last thing you would want to worry about is the terms and conditions of your health insurance policy. One of the key elements people tend to overlook is the room rent and ICU room rent limits. It may not seem like something big at the time of purchase, but it may cost you later.
What is this limit? The aim of this blog is to help you understand this question, so you are always clear with the charges of room rent while making a claim.
Room Rent Limits Explained
When you are hospitalised, you are provided with a bed. For each day (24 hours) you occupy that bed, you pay a rent to the hospital. This is called the room rent per day. Most policies apply a “room rent cap”.
Room rent cap is the maximum amount you are entitled to use towards the rent per day.
It is important to know the terms and conditions of your health insurance policy, since they directly affect the final amount of your insurance claims. There could be multiple ways in which rent capping or limit could be applied such as:
- As a percentage on the sum insured: if your Health Insurance Sum Insured is INR 300000 and Room rent capping is 1% of the Sum Insured, then you will only be eligible to avail INR 3000 per day (1% * 3,00,000) for the room rent.
- Fixed amount: the rent covered by your insurer is a fixed amount (for example Rs. 2,000/day) irrespective of Sum Insured.
- Fixed and Variable capping: usually the lower between the fixed amount and a percentage. For example: 1% of sum insured or INR 2,000 whichever is less.
- As Per Room Category: the different room categories are Day care rooms, single rooms, twin sharing rooms, deluxe room and private rooms. Your insurance may only cover one, a few types.
- No capping: there are some policies, without any capping. Since they also come without other sub-limits, the premiums on these policies can be much higher.
One of the most popular methods of capping is up to a certain percentage of the total sum insured. Most health insurance policies generally cover between 1% to 2% of the sum insured, i.e. you can only claim up to that percentage as room rent for a regular room. The limit is generally higher for ICU rooms (2% to 5%).
Exceeding Your Room Rent Limit
If your rent exceeds the stipulated limit mentioned in the policy, a term called proportionate deductions will be used.
In simple terms, it means you will have to pay (from your own pocket) for the cost of the health insurance claim in a similar proportion to your amount of limit exceeding for room rents.
If the policyholder opts for a higher room limit, the difference amount will be converted into a percentage and this percentage of amount will be deducted across the final bill except medicines. Here’s a simple equation to calculate proportionate deductions:
Proportionate deductions: [Total admissible amount] * [1-(allowed room rent/actual room rent)]
To understand how that works, here’s a simple example:
- Health Insurance Sum Insured: INR 3,00,000
- Room Rent Limit per day: 1% of the Sum Insured, which is INR 3,000 in this case
- Actual Room Rent while hospitalized per day: INR 4,000/day
- Final Hospital Bill eligible for the Insurance claim: INR 1,00,000/-
- Payable by Insurance Company: INR 75,000/-
- Payable by You: INR 25,000 (1,00,000*(1-0.75) i.e. 100000*0.25= 25000/-)
The above example shows how empirical it becomes to have a higher room rent limit in your policy.
Benefits of Onsurity’s employee healthcare plan
The group health insurance facilitated by Onsurity’s healthcare membership has a rent limit of 2% of the sum insured (as compared to the market standard of 1%) for normal room and 5% of the sum insured for ICU room (as compared to the market standard of 2%).
Further, our healthcare features and benefits are designed in a way that is adaptable to each company’s specific needs by providing comprehensive healthcare benefits and wellness features for your employees.
Onsurity offers more than just group health insurance for startups. Our healthcare plans come with benefits like doctor teleconsultations, online lab test booking and discounted medicine orders. It’s the smart way to help you and your team save more on your healthcare costs.