Mental illness and insurance: Moving from awareness to access

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In the last ten years, while India has made substantial progress in mental health awareness, access and affordability of treatment remain challenges. Building awareness and destigmatisation efforts can play a crucial part in shifting attitudes, they only address a part of the issue. With its ability to democratise access at scale, a better mental health insurance coverage system could fill the gap. First, let's understand the context.

The massive scale of mental illness in our country pre-dates the pandemic, with a report in The Lancet Psychiatry suggesting that approximately 200 million Indians suffer from mental illness. That is a staggering number.

When we started LLL (LiveLoveLaugh) seven years ago, we knew we were taking on a complex and intimidating challenge. Many aspects of our country's mental health system—awareness, stigma reduction, treatment, caregiver support, and healthcare capacity-building—needed attention. None of those could be addressed without reforming opinions on mental health en masse. We required a declaration of intent that recognised mental health as a priority through a fundamental shift in thinking. That's what the Mental Healthcare Act 2017 promised by shifting the focus towards a rights-based approach aimed at safeguarding the rights of individuals with mental illnesses.

Replacing the Mental Health Act of 1987, the Mental Healthcare Act (MHC Act) 2017, enacted on May 29, 2018, recognises mental illness as a condition affecting a person's thinking, perception, behaviour, and emotions.

It proposed access to mental healthcare, treatment, and support without discrimination. The Act established Mental Health Review Boards, decriminalised suicide, promoted community-based care, emphasised human rights and confidentiality, and encouraged awareness and education about mental health. Its primary goal was to improve mental healthcare services and reduce the stigma surrounding mental illnesses in India.

The MHC Act required insurance companies to cover mental illness treatment, but many providers didn't include it in their policies. However, in 2022, due to the increase in mental illness after the pandemic and a previous recommendation in 2018, the Insurance Regulatory and Development Authority of India (IRDAI) ordered all insurance providers in the country to cover mental illnesses. Although sound in principle, this mandate has yet to create the desired change.

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Claims for mental illness continue to be an uphill battle. While in some cases, insurance companies have entirely rejected claims related to hospitalisation due to mental illness, others have denied health coverage to persons with mental illness altogether. People with mental health conditions have found getting personal health insurance coverage challenging. In an analysis of 268 health insurance policies from providers nationwide, the Centre for Mental Health Law & Policy found that 224 excluded coverage for suicide or self-injury, while 267 excluded coverage for substance abuse disorders and addiction. These omissions paint a stark picture.

Contrary to likely assumptions, however, insurers are open and even eager to help. In our discussions with individual insurance companies and the General Insurance Council, I have only seen a willingness to learn and implement. The challenge is a lack of awareness and knowledge (about mental health and illness) and operational models in an industry so accustomed to managing claims for physical conditions.

The first step in the evolution would be for insurers to understand the MHC Act, 2017, along with its key recommendations—specifically around equal treatment of physical and mental illnesses.

Consider these numbers: For FY19-20, the total amount of claims paid for mental healthcare was Rs37 crore, a minuscule figure compared to the total of all claims of Rs32,838 crore. Contrast that with the increasing incidence of mental illness, and it's easy to see why discriminatory insurance only worsens an already difficult situation.

Insurers must also include suicides and attempted suicides in their coverage. This is particularly relevant to the Indian context since India has one of the highest suicide rates in the world. As a nation, we need to realise that the environment plays a role in everyone's well-being, and we must stop blaming individuals for their mental health conditions.

Also Read: Only one in ten people in India receive adequate treatment for mental health disorders

Besides access to mental healthcare being a fundamental human right, improving mental health coverage also offers tangible benefits to insurance companies. Bridging the treatment gap through better coverage would allow insurers to take their place as critical stakeholders in the mental health ecosystem, enhancing their credibility and goodwill. An efficient and inclusive claims process for mental health treatment would also reduce litigation from dishonoured claims, where rulings are frequently in favour of the insured, as seen in recent examples across the country.

The bottom line is that mental illness is everyone's responsibility and needs immediate intervention. Awareness might be the first step, but affordable treatment can make a real difference. Seeing more people reaching out for help in recent years has been heartening. We need to help everyone get the support they need by working collaboratively.

Stakeholders have already initiated joint steps to tackle the challenge at a policy level. I am convinced this collaborative approach will gain momentum and contribute to meaningful change in mental healthcare delivery and support systems.

The writer is CEO of The Live Love Laugh Foundation.

The thoughts and opinions shared here are of the author.