Can't Deny Medical Reimbursement Only Because Insured Person was Treated at Non-Network Hospital: Kerala HC

Ernakulam: The Kerala High Court recently reiterated that medical reimbursement claims cannot be denied only because an insured underwent treatment in a hospital not approved by the insurer.

With this observation, the HC bench comprising Justice C S Dias granted relief to a woman whose husband had to undergo an emergency liver transplantation in a non-ESIC hospital and therefore was being denied her claim for reimbursement by her insurer i.e. Employees State Insurance Corporation (ESIC).

"The respondents 1 to 3 are directed to process the petitioner’s claim and reimburse the medical expenses for her husband’s treatment in accordance with law and as expeditiously as possible, at any rate, within a period of 60 days from the date of receipt of a certified copy of this judgment, after affording the petitioner an opportunity of being heard, if felt necessary," ordered the HC bench.

The petitioner was an insured employee who took her husband to the ESI hospital for treatment of his liver disease. After undergoing treatment for a few days at the said hospital, the patient was referred to the Medical College Hospital, Thrissur and the Superintendent of the ESI Hospital advised the patient for liver transplantation and he was referred for approval to the Technical Committee of Aster Medcity Hospital.

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Accordingly, by issuing a certificate, the ESIC State Medical Officer informed the Superintendent of the ESI Hospital that the Technical Committee had approved and recommended the patient for liver transplantation. Meanwhile, the Authorisation Committee for Transplantation of Organs granted permission to the patient for transplantation as per the provisions of the Transplantation of Human Organs and Tissues Act.

The patient was advised of an emergency liver transplantation since his health deteriorated. Consequently, the patient underwent the transplantation on 4.10.2023 by paying the medical expenses for the transplantation. Allegedly, after the surgery, the petitioner's claim for reimbursement was not processed. The Insurance Medical Officer of ESIC cited the reason that her claim could not be processed because she had not submitted the emergency certificate for undergoing the transplantation.

As per the petitioner, she submitted the emergency certificate immediately. Even then the authorities did not pay the reimbursement and due to this, she filed the petition alleging that the inaction of the authorities was arbitrary, illegal and unconscionable.

On the other hand, ESIC argued that if it is not an elective procedure, an emergency certificate is required. Further, ESIC submitted that the petitioner was intimated to rectify the defects in her claim form and was granted one year to submit the bills. As per ESIC, the expenditure incurred on private treatment from a non-ESIC or private hospital could be reimbursed only after ascertaining the emergency and the entitlement as per the CGHS rates. The State Medical Officer returned the petitioner's claim due to the non-submission of the emergency certificate and the internal ethical committee report. 

During the case proceedings, the counsel for the authorities stated that there was no prescribed form for the emergency certificate, but it should be submitted of the hospital with all the essential details, including the signature of the Doctor and the seal of the institute.

Accordingly, the Court directed the treating hospital to produce the emergency certificate. Consequently, the petitioner submitted the said certificate certifying that the patient had undergone live donor liver transplantation since he was in stage C cirrhosis, which carries a one-year mortality of 50 % to 60%.

While considering the matter, the Court noted that the principal objection of the authorities for not processing the petitioner's claim was that she did not submit the emergency certificate. After perusing the documents, the Court noted that the Technical Committee of the ESIC had had approved and recommended the patient’s case for transplantation surgery. It was after receiving the approval, the treating hospital conducted the surgery.

Apart from this, the court also perused the emergency certificate perused by the treating hospital, showing that the patient had undergone live donor liver transplantation since he was suffering from stage C cirrhosis, which carried mortality up to 50% to 60%. "Therefore, there is no room for any doubt that the patient had to undergo emergency surgery for his survival," opined the Court, further noting that ESIC authorities had conceded that ESI hospital did not have the facility to conduct the liver transplantation.

Relying on the Supreme Court order in the case of Shiv Kant Jha Vs. Union of India, the High Court bench reiterated that "It is well settled that medical reimbursement cannot be denied because the insured underwent treatment in a hospital not approved by the Insurer."

"In the instant case, the ESI hospitals do not have the facility for liver transplantation. Based on the respondents' recommendation and concurrence, the patient was taken to the 4th respondent for treatment. Therefore, the respondents cannot turn around and say that they were ignorant of the patient's medical condition. The respondents’ insistence on an emergency certificate to process the petitioner’s claim is untenable and hyper-technical. Now, the said objection is also set to rest with the production of Ext.P22," the Court further noted.

Perusing the emergency certificate (Ext. P22), the materials placed on record, and the legal provisions, the Court directed the authorities to process the petitioner's claim and reimburse her the medical expenses for her husband's medical treatment.

To view the order, click on the link below:

https://medicaldialogues.in/pdf_upload/kerala-hc-medical-reimbursement-265848.pdf

Also Read: Employees should not be denied medical reimbursement For Emergency Treatment Due To Non-Empanelment of Hospital: Delhi HC