10% co-pay could balloon patient costs to 15-19%, insurers propose

Insurance firms operating in India's retail health insurance segment are advocating for a mandatory 10 per cent co-payment requirement on policies as a means to reduce premium costs for consumers. However, analysis suggests the measure could significantly increase patients' financial liability beyond the stated co-pay percentage.

Under the proposed co-payment structure, policyholders would bear 10 per cent of covered hospital expenses directly, with insurers covering the remainder. Industry proponents argue lower premiums would result from this risk-sharing arrangement, making health insurance more affordable and accessible to middle-income households.

Yet the actual cost to patients could prove substantially higher. When factoring in non-payable expenses—treatments excluded from coverage, diagnostic procedures not pre-authorised, and out-of-pocket costs for medications and ancillary services—patient contributions could escalate to between 15 and 19 per cent of total hospital bills, according to preliminary assessments.

The discrepancy between stated co-pay rates and real out-of-pocket expenses underscores the complexity of health insurance claims processing in India. Consumers often discover significant portions of their medical bills fall outside policy coverage limits, effectively elevating their actual financial participation well beyond nominal co-payment percentages.

Insurance regulators will need to carefully weigh premium affordability against consumer protection before approving any widespread adoption of mandatory co-payment requirements across the retail health insurance market.