In a significant decision, the Delhi High Court has clarified that while delays in medical insurance claim settlements may justify compensation for mental harassment, they do not constitute criminal offences under the Indian Penal Code.
Justice Neena Bansal Krishna, while dismissing a petition filed by Shashank Garg against Max Super Speciality Hospital, observed:
"Such incidents of harassment felt by patients in settling their final bills are not untold stories. These are frequently suffered and often aggravated by the trauma patients already face due to illness."
The Background
The petitioner, an advocate by profession, was treated for cysticercosis at Max Hospital under a cashless insurance policy issued by Max Bupa. Despite a partial pre-authorisation of ₹75,000, he was asked to deposit ₹1.45 lakh before surgery. Post-surgery, the final insurance approval came just hours before discharge, leading to a delay in his release.
His main grievance was that ₹57,332 was wrongfully debited from his advance, despite full approval from the insurer. Additionally, he claimed he was wrongfully confined and accused the hospital of cheating, criminal conspiracy, and breach of trust under Sections 420, 406, 342, and 120B of IPC.
The High Court upheld the Sessions Court's decision, which had earlier quashed the summoning of the hospital staff. It found no fraudulent intent on the hospital’s part and ruled that:
"The petitioner had been informed in advance about the payment schedule. There was no dishonest or fraudulent intention behind the advance deposit request."
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Further, it was observed that any error in billing—such as not including a ₹12,495 discount—was rectified promptly upon the petitioner's complaint. The delay in discharge was attributed to procedural steps, not wrongful restraint.
"It may seem to be an onerous condition, but definitely cannot be stated to be extraction of money… no offence of cheating is made out."
Justice Krishna expressed concern over recurring delays faced by patients while dealing with insurance claims:
"Though many courts have recommended regulatory reforms, including a Patient Rights Charter, there is still no concrete solution. This matter requires attention from the Central and State Governments in consultation with IRDA and Medical Councils."
The Court held that none of the criminal charges were substantiated and dismissed the petition:
“There was neither any fraudulent nor dishonest intention. Delays in discharge due to insurance approval, though inconvenient, do not attract criminal liability.”
This ruling reinforces the distinction between civil inconvenience and criminal conduct, emphasizing the need for policy reforms to streamline insurance claim processes without burdening patients or judicial systems.
In view of the above, the Court upheld the Sessions Court's order quashing the summoning order.
Case title: Shashank Garg vs. State & Ors (CRL.M.C. 3583/2018)
