Why Your ₹25 Lakh Health Cover Isn’t Enough

For many Indian families, a ₹25 lakh health insurance cover feels reassuring.

It sounds substantial. Responsible. More than “adequate. ”After all, how often does anyone spend ₹25 lakhs on a single hospitalisation? And yet, this is the uncomfortable reality: thousands of insured patients with high-value policies still pay lakhs out of pocket every year.

Not because insurance failed. Not because hospitals cheated. But because insurance and hospital pricing operate on two very different logics. Understanding this gap is the first step toward avoiding expensive surprises.

Insurance doesn’t control hospital pricing

Health insurance is designed to settle claims within defined rules.It is not designed to negotiate how hospitals price care.

This distinction matters.

Hospitals decide:

• how packages are structured

• what is included or excluded

• which items are bundled and which are billed separately

• How Room Categories Affect Downstream Charges

Insurance steps in after these decisions are made.

Even a ₹25 lakh cover only applies within policy conditions, not against hospital pricing behaviour.

The myth of “full coverage”

Many people believe that a large cover automatically means minimal out-of-pocket cost.

In practice, out-of-pocket expenses arise from areas insurance does not fully control, such as:

• consumables and disposables

• room rent-linked billing slabs

• procedure sub-limits

• co-pay percentages

• exclusions that are technically policy-compliant

These aren’t rare edge cases. They are common features of modern hospital billing.

The result? Insurance pays what it owes. Patients pay the rest.

Non-payables: small items, large impact

One of the most common blind spots is non-payables.

Items like gloves, syringes, masks, catheters, dressings, and disposables are often:

• excluded by insurers

• loosely defined in packages

• billed as per actual usage

Individually, these costs look minor. Collectively, they can add ₹50,000 to ₹1 lakh or more to a single admission.

Your ₹25 lakh cover doesn’t change that.

Room rent caps quietly inflate bills

Room rent is another underestimated factor.

Many policies have room rent limits — either explicit or implicit. When a patient chooses a room above the eligible category, insurers don’t just reduce room rent reimbursement.

They often apply proportional deductions across:

• doctor fees

• procedure charges

• investigation costs

This is known as room rent-linked billing.

Patients don’t notice it upfront. They only see it later, when insurance reimbursement is lower than expected.

The cover amount stays the same. The payout drops.

Sub-limits shrink effective coverage

Sub-limits are policy-specific caps on certain procedures or treatments.

You may have a ₹25 lakh policy, but:

• A knee replacement may be capped at a lower amount

• A cardiac procedure may have defined ceilings

• implants may have separate limits

Hospitals price based on actual costs. Insurance reimburses based on policy ceilings.

The gap becomes an out-of-pocket expense.

Inflated base packages magnify co-pays

Co-pay clauses are another reason high deductibles still fall short.

If your policy requires you to pay, say, 10% of the bill, that percentage is applied to the hospital’s total charge — not a negotiated or optimised number.

When base packages are inflated, even small co-pay percentages translate into large absolute amounts.

A 10% co-pay on a ₹7 lakh bill is very different from a 10% co-pay on ₹5.5 lakhs.

Insurance didn’t fail. Pricing structure did.

One admission can exhaust a family floater

Family floater policies are popular for good reason. But they come with risk concentration.

A single major hospitalisation — such as cardiac surgery, spine surgery, or complicated maternity — can consume a large portion of the total cover.

That leaves little buffer for:

• post-operative complications

• follow-up admissions

• another family member’s emergency

The ₹25 lakh cover doesn’t reset.It depletes.

Insurance settles claims. It doesn’t optimise bills.

This is the most important distinction to understand.

Insurance companies:

• process claims

• enforce policy terms

• reimburse eligible expenses

They do not:

• renegotiate hospital packages for patients

• restructure estimates to reduce non-payables

• benchmark prices across hospitals

• optimise room categories for cost efficiency

That responsibility falls entirely on the patient.

Most patients don’t realise this until after discharge.

Why patients still overpay — even when insured

Put simply, insured patients often overpay because:

• hospital pricing is opaque

• insurance rules are complex

• decisions are made under stress

• negotiation happens too late

• patients are unrepresented

Everyone else in the system negotiates:

• insurers

• corporates

• government schemes

Patients usually don’t.

This is where planning matters

The biggest difference between patients who minimise out-of-pocket costs and those who don’t is timing.

Cost optimisation is possible before admission, when:

• estimates can be reviewed

• packages can be structured

• insurance can be aligned

• options can be compared

Once treatment begins, leverage disappears.

A high cover helps.But planning helps more.

What a smarter approach looks like

A smarter approach to hospitalisation involves:

• understanding how your insurance actually applies

• reviewing estimates for structure, not just totals

• Comparing hospitals on pricing logic, not brand alone

• clarifying inclusions and exclusions upfront

• knowing your likely out-of-pocket cost before admission

This doesn’t require medical expertise.It requires representation.

Where Health Samadhan fits in

Health Samadhan exists because patients were expected to navigate this complexity alone.

We don’t sell insurance.We don’t change doctors.We don’t influence treatment.

We work on the financial layer — before admission — reviewing hospital estimates, benchmarking options, and optimising costs while keeping care unchanged.

Our role isn’t to fight insurers or hospitals.It’s to ensure patients don’t default to retail pricing.

Reduce Hospital Costs

Why our model is different

We work on a simple principle:

If we don’t reduce your hospital costs, you don’t pay us.

No upfront fees.No commissions from hospitals.No incentive to oversell savings.

Sometimes the outcome is savings.Sometimes it’s clarity.Both matter.

The real takeaway

A ₹25 lakh health cover is valuable.It just isn’t sufficient on its own.

Insurance protects you from catastrophic loss.It does not guarantee fair pricing.

That gap — between coverage and cost — is where most out-of-pocket expenses live.

Understanding that gap is how families avoid unpleasant surprises.

Before your next hospital admission

If you have a planned hospitalisation coming up, don’t ask only:“Is my insurance enough?”

Also ask:“Is this estimate structured fairly?”

That question alone can change outcomes.

India's First Hospital Broker

Health Samadhan helps patients plan hospitalisation with cost clarity and representation — before admission.

No savings. No fee.