Non-payable items in health insurance: IRDAI’s list, consumables and what to check

What are non-payable items in health insurance?

Non-payable items are charges on a hospital bill that your policy won’t pay, even when the claim itself is accepted. Most are non-medical or disposable: toiletries, attendant food, phone and laundry charges, gloves and masks, and admin fees such as registration or documentation charges. In a cashless claim the hospital collects them from you at discharge. In a reimbursement claim they are deducted from what you are paid.

Your policy wording decides what is non-payable. Many wordings attach a list as an annexure, under a title such as “List of non-medical expenses” or “Items for which coverage is not available”.

What is IRDAI’s list of non-medical expenses?

It is a standard four-part list that IRDAI set out in Annexure I of its Master Circular on Standardization of Health Insurance Products (IRDAI/HLT/REG/CIR/193/07/2020, 22 July 2020). IRDAI’s May 2024 Master Circular on health insurance superseded that circular and doesn’t reproduce the list, but many policy wordings still attach it. The table gives representative items from the 2020 text.

In IRDAI’s 2020 standard policy wording, List I is titled “Items for which coverage is not available in the policy”. In the circular itself, the same 68 items are “optional items” that insurers could choose to cover, for example through an add-on.

What does “subsumed into room charges” mean?

It means the item is treated as part of another charge, not as a separate bill line. Housekeeping, gowns and documentation charges belong inside the daily room rent. Gauze and surgical blades belong inside the surgery charge. Registration and diet charges belong inside the cost of treatment. You aren’t meant to be billed for them twice.

When IRDAI set out these lists in 2020, it asked insurers to make sure hospitals didn’t bill List II–IV items to policyholders separately, and to put this in their agreements with network hospitals for cashless claims. In practice, if one of these items appears as a separate line, insurers commonly disallow it and you end up paying it. Ask the billing desk to remove or merge such lines before you pay, especially in a cashless claim.

Example: non-payable items on a ₹1.5 lakh bill

Example. A 3-day hospital stay for surgery is billed at ₹1,50,000. The itemised bill includes these lines:

The insurer pays ₹1,50,000 − ₹9,700 = ₹1,40,300, assuming everything else is admissible and there is no room rent deduction. Any co-payment is applied after this. The ₹4,400 of List II–IV lines (₹1,500 + ₹1,900 + ₹1,000) is the part worth querying, because those items were meant to be included in other charges.

What does consumables cover pay for?

Consumables cover is an add-on, or a built-in benefit in some products, that pays for some or all of the List I items a policy would otherwise refuse. Insurers market it under different names, and the terms are product-specific. IRDAI’s 2020 circular allowed insurers to cover List I items or design add-ons for them. Before you rely on it, check:

• whether it covers all of List I or only medical consumables such as gloves, masks, electrodes and kits;
• whether comfort items, such as attendant food, TV and laundry, are left out;
• whether it has a rupee cap per claim or per year;
• whether it pays only when the hospitalisation claim itself is accepted, and whether your co-pay applies to it.

Do hospital packages include consumables?

Often, for planned procedures. Many network hospitals bill common surgeries at a package rate agreed with the insurer or TPA, which usually covers the room, procedure, medicines and consumables for a set number of days. Items inside the package aren’t billed separately, so fewer of them show up as non-payable. Items outside it, such as extra days, attendant food or comfort items, are still checked against the lists. IRDAI’s 2024 policyholder-protection rules require the policy to state whether package rates exist, so ask for the package inclusions in writing before admission.

Are consumables cut by proportionate deduction?

These are two different cuts. IRDAI’s June 2020 norms on proportionate deductions, superseded in May 2024, barred insurers from cutting pharmacy and consumables in proportion when you take a costlier room, and many wordings still follow that definition. See proportionate deduction for how that works. A consumable that isn’t cut in proportion can still be refused in full if it is on List I. Medicines prescribed for your treatment are payable; gloves and masks usually aren’t, unless you have consumables cover.

What to check in your policy

1. Policy wording annexures: search for “Annexure”, “List I”, “non-medical”, “non-payable”, “optional items”, “subsumed” and “items for which coverage is not available”.
2. Benefits and add-ons: search for “consumables”, “consumable benefit” and “non-medical expenses” to see whether any cover applies.
3. Policy schedule: check whether a consumables add-on is listed, with any limit.
4. Customer Information Sheet: read the “Exclusions” row, which should summarise what the policy doesn’t cover.
5. Your hospital bill: ask for an itemised bill, not a summary, so you can match each line against the lists.

Where people get caught out

• Accepting vague lines. “Miscellaneous charges (not explained)” is a List II item. Ask what it covers.
• Paying for subsumed items twice. Housekeeping, admission kits and documentation charges billed on top of room rent are worth querying.
• Assuming consumables cover pays everything. Some add-ons pay only for medical consumables, not comfort items.
• Reading “not cut in proportion” as “paid”. A consumable can escape proportionate deduction and still be refused.
• Buying discharge items through the hospital. Walking aids, thermometers, braces, nebuliser kits and oxygen cylinders for home use are all on List I.