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OPD coverage gains popularity among Indian consumers, Health News, ET HealthWorld

By on September 11, 2022 0

By Amit Chhabra

The COVID-19 pandemic has been turbulent for the world in more ways than one. It has completely changed the way people think about their health, their finances, the way they want to work, and even the way they want to live their lives. Every industry has undergone major changes during the COVID period, and the same is true for the insurance industry. And even the consumer is no longer the same because his preferences have changed in many respects.

While the pandemic has re-emphasized the importance of having a health insurance policy, the mix of policy the consumer now wants is quite evolved. In line with industry trends, consumers no longer want this mundane policy that only covers hospitalization costs. After COVID-19, they are more likely to purchase a holistic plan that also covers OPD (Out Patient Department) expenses. OPD expenses are those incurred when treatment and diagnoses are performed while visiting a clinic or consulting room in a hospital, without actually being hospitalized.

Increase in demand for OPD coverage

According to data from Policybazaar, this trend is rapidly accelerating as nearly 15% of customers now purchase some sort of OPD coverage in addition to health insurance. This number was zero before. Why is this, one may wonder. Indeed, if an ordinary health insurance policy covers the costs of medical care in the event of hospitalization, but when it comes to costs related to medical care that do not involve hospitalization of the patient, they do not are generally not covered. Industry data suggests that OPD accounts for over 70% of costs in healthcare. And this cost is usually borne by most people. Moreover, OPD expenses were not covered by health insurance policies before. This meant that despite having a health insurance plan, one still had to pay for expenses such as medical consultations, medications, tests, and checkups out of pocket.

And according to various reports, disbursements in the case of COVID-19 treatment were in the range of 30-50% of the total amount spent on COVID-19 treatment. It is therefore natural that the consumer has become aware of these expenses and wants health coverage that also covers this cost.

Coverage of physical consultations on digital-only OPD

Here are some interesting trends Policybazaar data indicates –

• The most common OPD coverage preference among consumers is one that also has a “physical component”. Customers find this to be a better option compared to only “digital OPD” where online doctor consultations are covered but physical visits are not.

• While the trend of opting for OPD coverage has found more takers in Tier 1 and Tier 2 cities at the moment, it is gradually gaining traction in Tier 3 cities and beyond as well.

• In addition, most policyholders prefer the cashless method of payment where they do not have to pay anything upfront and wait for reimbursement of the claim. Instead, they can just take the cashless route which is smoother.

• In terms of gender composition, more and more brands are opting for OPD coverage vis-à-vis female customers. In fact, of all consumers who opted for OPD coverage, approximately 80% are men.

• The preference for opting for OPD coverage is also higher among policyholders who opt for a higher sum insured. According to available data, typically, 30% of all insurance consumers opt for health insurance cover of Rs 1 crore.

• Of these consumers, 30 percent of customers opt for some sort of OPD coverage. Most customers who opt for OPD supplemental coverage use the sum insured for expenses related to medical consultation, diagnostics and pharmacy fees. The data clearly indicates that OPD coverage is gaining popularity among consumers nationwide.

Common expenses covered by OPD health coverage:

Doctor’s visit: A regular health insurance plan does not cover doctor’s visit costs when you make this occasional visit to seek medical advice. However, by opting for the OPD add-on, you ensure that even this expense is covered by your policy. This supplement is particularly useful in family plans that also include coverage for children, as doctor visits are likely to be frequent in such cases.

Diagnostic tests: An OPD top-up also covers the cost of diagnostic tests whether or not you are diagnosed with a disease. This is applicable as long as the tests are ordered by your doctor.

Pharmacy costs: These prescription drug costs can be high, but are not covered by a regular health insurance plan. With OPD coverage, even these expenses are covered by your policy.

Dental procedures and other aids: Dental procedures — like root canal treatment, fillings, and tooth extractions — aren’t covered by regular health insurance plans. On the other hand, if you have opted for additional OPD coverage, not only are you protected against the expenses incurred for such procedures, but even the cost of dentures is covered up to a certain limit. In fact, even the cost of hearing aids and glasses – like contact lenses and glasses – are covered up to a specified limit.

OPD coverage offers immense benefits and covers you extensively, whether it’s something as simple as a fever or complex daycare procedures. Plus, it also compensates you for those hefty pharmacy bills and diagnostic tests. In total, these medical costs can add up in the long run and result in a significant financial setback in the absence of OPD coverage. At present, it is an indispensable supplement, which many consumers have already understood.

By Amit Chhabra, Manager – Health Insurance, Policybazaar.com

(DISCLAIMER: The views expressed are solely those of the author and ETHealthworld does not necessarily endorse them. ETHealthworld.com shall not be liable for any damage caused to any person/organization directly or indirectly)