The Kannur District Consumer Dispute Redressal Commission recently held an insurance company liable for deficiency of service and unfair trade practice, ordering it to pay Rs 86,263 to a police department employee who had enrolled in the Medical Insurance Scheme for State Employees and Pensioners (MEDISEP) and admitted his mother to an empanelled hospital for emergency treatment, but was allegedly forced to pay a portion of the hospital bill.President Ravi Susha and members Molykutty Matthew and Sajeesh KP were hearing a complaint filed by an employee of the police department against the insurance company and third-party administrator (TPA) responsible for MEDISEP, alleging that they had denied him a claim that was legally covered by the policy.“As per the MEDISEP scheme, the beneficiary is entitled to get the cost of drugs even after discharge from the hospital. So, the 3rd OP rejected the reimbursement claim. The act of OPs 2 and 3 (TPA and insurer, respectively) caused much mental agony and financial loss to the complainant. So, there is deficiency of service and unfair trade practice on the part of OPs 2 and 3. So, the liability of OP No.1 (the hospital) is exonerated,” the September 28 order read.According to the complainant, the insurance policy covered his wife, mother and children. The man claimed that due to a sudden stroke, his mother was admitted to a hospital in Mangaluru on February 2, 2024, and at the time of admission, he had produced a MEDISEP card before the hospital authority, which assured him of cashless treatment.After 15 days, on March 3, 2024, the hospital demanded Rs 50,000 from him as an advance for keeping his mother admitted. At the time, the man requested an up-to-date hospital bill and he was told that it was below Rs 1.5 lakh. The limit for the MEDISEP insurance coverage was Rs 4.5 lakh, it was pointed out.The doctor said his mother’s treatment should be continued for 10 more days as there was no improvement, but she was discharged after the complainant’s request. The man said that of the total bill of Rs 1.40 lakh till March 2, only Rs 38,800 was approved by the insurance company, and a concession of Rs 27,085 was given by the hospital authority. The balance Rs 74,263 was paid by the man.The man alleged that he was entitled to get full coverage of the bill since it was only Rs 1.40 lakh and that the insurance company had “no right to deny the claim which is legally covered by the policy”. He further claimed that he had followed the terms and conditions of the policy. On March 3, 2024, the man sent a legal notice to the TPA and the insurance company, as a result of which they remitted only Rs 8,000 as the balance payment.Story continues below this ad‘No enhancement possible’Advocate RP Remesan, representing the hospital, argued that the treatment was provided in accordance with the standard medical protocol and that the total bill was duly submitted to the TPA and approval for Rs 38,800 was received towards the admissible claim under the policy. Later, the man had re-submitted a fresh claim for the balance amount of Rs 8000, which was reprocessed by the hospital in the interest of fair settlement. No one appeared for the TPA.Advocate P P Venu, appearing for the insurance company, argued that the claim had been settled by the TPA as per the package rates of the scheme and no enhancement was possible. The counsel contended that the maximum amount reimbursable for the treatment undergone by the mother was Rs 46,800 and the man was not entitled to get any more sum from the insurance company.The district commission observed that the insurance company’s act caused the man “much mental agony and financial loss. So the 2nd (TPA) and 3rd OP’s (Insurance Company) are directly bound to redress the grievances caused to the complainant.”Accordingly, the commission directed the insurance company to pay the claim amount of Rs 66,263 to the man, along with Rs 13,000 as compensation for mental agony and Rs 7,000 as litigation costs.Story continues below this adTakeawayThe ruling establishes the obligation of insurance companies to ensure proper processing of claims of patients and that the concerns of the consumers must not be ignored, causing them unnecessary inconvenience.For consumer-related grievances, individuals may contact the consumer helpline in their respective states and union territories (Kerala: 1800-425-1550) or call the National Consumer Helpline on 1915 for assistance.Don’t miss out on these stories:AIIMS Rishikesh ordered to pay Rs 60,000 after ‘wrongly declaring’ man as HIV positiveWoman fitted with Rs 2.45 lakh ‘defective dentures’, dentist ordered to pay Rs 3.15 lakhStory continues below this adNearly 6 lakh cases pending in consumer commissions, over 860 posts vacant: Centre