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ombudsman news

issue 1

January 2001

chronic medical conditions

Private medical expenses insurance is a relatively small but growing sector of our casework. The distinction between chronic and acute medical conditions has received considerable attention in recent months, not just in our casework but also in public debate. The exclusion of medical expenses claims because an insurer deems the medical condition chronic can come as a real shock to the patient/policyholder. We have had to adjudicate on a steady stream of such cases in recent months.

The marketing of private medical expenses insurance often alludes to the well-publicised difficulties of the NHS and to the potential peace of mind offered by insurance which gives ready access to private treatment, offsetting the financial consequences. Policyholders' expectations are therefore high.

By their nature, private medical claims are often made at a time of very real pain and suffering. Medical expenses insurers generally recognise this and treat claims with sensitivity.

significance of acute/chronic distinction

It is a general feature of private medical expenses insurance that chronic conditions are excluded from cover or that cover is limited to acute conditions. The industry is presently working on common definitions of "chronic" and "acute" but insurers need to do more to clarify the distinction. They also need to do more to explain to policyholders the significance of excluding chronic conditions.

While different insurers use different definitions of "acute" and "chronic" at present, the general intention is much the same. For example, in its policy document, one insurer explains a "chronic" condition as follows:

"This term is used to describe conditions which, with current medical knowledge, treatment can alleviate but not cure. Examples of this would be allergies, asthma, eczema, arthritis, irritable bowel syndrome etc. Whether or not a particular complaint is chronic or acute is defined in medical dictionaries. These definitions will form the basis of our decision."

By contrast, this is how an "acute" condition is described:

"This term is used to describe a condition of rapid onset, severe symptoms and brief duration. Examples of this will be appendicitis or tonsillitis. It may also include conditions resulting from chronic illnesses but which can be cured or substantially cured. An example of this would be a hip replacement or heart bypass surgery."

In practice, it is often far from straightforward to interpret what constitutes a "chronic condition" and referring to a medical dictionary, as the definition suggests, is of little help.

Excluding chronic conditions means a wide range of common ailments, such as asthma, eczema, arthritis and diabetes are simply not covered by private medical insurance, even if the condition only arose after the insurance was taken out. More significant conditions, such as dementia and Parkinson's disease, where treatment is presently unlikely to bring about a cure, are also not covered.

But the distinction between acute and chronic goes much further than categorising different medical conditions.

when a life-threatening condition becomes chronic

One particularly troublesome area is where a serious medical condition deteriorates and various forms of treatment are tried without success. For example, an insurer may initially accept a condition such as cancer as "acute" but then, over time, reassess it as "chronic". In effect, the insurer says "the doctors have tried these treatments (operations or whatever) to cure your condition and they haven't worked. We don't think now that you can be cured and whatever the doctors may say, further treatment is really just about relieving symptoms not bringing about a cure. On that basis we will not cover further treatment."

However, the point at which this change applies is often not readily identifiable. In some cases, no doubt, once a treatment has failed it is clear to all concerned that further treatment is primarily for the temporary relief of symptoms. It is not in any sense a cure - hence the condition becomes chronic. In other cases, the point of transition is much more open to debate and requires a greater degree of judgement on the part of the insurer.

In many situations, the announcement that the insurer now considers the condition chronic is tantamount to saying that, in the insurer's view, the patient will not recover. This can obviously be extremely distressing to policyholders and their relatives, particularly as the patient's own medical advisers may not have reached this potentially terminal diagnosis, or may not have communicated it to the patient and his relatives. Such cases must therefore be handled with considerable sensitivity.

informing policyholders

Excluding chronic cases from cover is a particularly significant term in these policies. It means the scope of the cover provided is far more limited than potential customers often realise.

It is therefore unfortunate that the distinctions between acute and chronic conditions are little understood by customers and are so reliant on the particular interpretation given by insurers themselves. This may, of itself, place customers at an unfair disadvantage. The distinction between "chronic" and "acute" is not one most of us make when discussing our illnesses. Nor, in our experience, do doctors make this distinction.

The interpretation of this exclusion has far-reaching consequences for policyholders. It means it is unlikely an insurer will meet any costs for treating many common conditions and may not cover treatment when conditions deteriorate. So it is essential that the significance of the exclusion is fully explained to policyholders before they buy the insurance. Insurers will understand that, if this is not done, the ombudsmen are unlikely to support their rejecting claims that rely heavily on the insurer's interpretation of this exclusion.

case studies - chronic medical conditions

Walter Merricks, chief ombudsman

ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.

The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.