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What is Cashless Health Insurance – Benefits & Process

Published on Sept 14, 2020. EST READ TIME: 5 MIN

Health insurance is critical to secure yourself financially against any medical emergency. And one of the essential features that a health insurance plan should have is the cashless facility. It is because while availing the claim on the health insurance , the payments for the treatment become more accessible with a cashless feature.

With a cashless facility, the insured doesn’t have to spend any cash, but rather, the hospital claim is settled directly between the hospital and the insurance company. Ithelps in reducing the financial burden on the insured at the time of discharge, as there is no need to arrange for cash that would be reimbursed later. Getting the right treatment thus becomes easier as the payments are directly taken care of by the insurance company, in case the treatment is done at any of the network hospitals listed by the insurance provider.

Importance of Having a Cashless Health Insurance

Owing to ever-increasing medical costs and crisis, like, the current pandemic, people are often cash strapped and cannot always meet medical expenses efficiently. In such a scenario, cashless health insurance is a big boon as you will be able to avail treatment without needing any immediate access to cash. Make sure that you visit one of the network hospitals registered under your health insurance provider to get the treatment.

Having a cashless health insurance policy will give you peace of mind and reduce unnecessary stress. It will save your energy, time and efforts during the settlement of the claim with the insurance company as well.

Comparison of Cashless and Reimbursement Claims

As you already know, the policyholder pays a premium to the health insurance company to cover for medical expenses of the family members covered under the policy. The process of getting the settlement against the medical expenses can be either cashless or through reimbursement claims. So, here is how they are different:

Cashless

Under the cashless feature of the health insurance policy, the policyholder doesn’t need to pay upfront when the treatment is delivered in a hospital. In such a case, the settlement of bills is done between the insurance company and the hospital, without the need for any cash payment by the policyholder.

Reimbursement claims

In case of reimbursement claims, the policyholder needs to make the cash settlement with the hospital and then apply for a reimbursement with the insurance company later, by submitting all the relevant documents. So, the policyholder pays the hospital first and then claims the amount from the insurance company. Usually, if the treatment is not received in one of the network hospitals, the reimbursement option is used for settlement.

How Does Cashless Insurance Work?

Availingcashless insurance is easy and convenient. The policyholder has to make sure to get the treatment done in one of the network hospitals of the insurance company. These network hospitals have a tie-up with the insurance company to provide cashless treatment. The coordination regarding the billing and other formalities is done by the representatives of the insurance company, to verify the claims of the policyholder.  In other words, once the verification is done by the insurance company representatives, the policyholder becomes entitled to cashless treatments, and the hospital gets approval for treating the patient.

Steps to Avail Cashless Insurance

  • Choose a network hospital from the list provided by the insurance provider.

  • Inform the insurance company by filling up the pre-authorization form at the insurance company’s desk at the hospital.

  • In case of emergency, you should inform within 24 hours of admission and in case of planned hospitalization, inform the insurer 48 hours before hospitalization.

  • Submit the duly filled and signed form to the insurance company representative along with necessary documents, like identity proof, policy document, medical papers like doctor’s prescription, etc.

  • Once the insurance representative sends the documents to his office, the approval is received to start cashless treatment.

  • The settlement of the bills is done after the insurance company approves all documents. In case the cashless treatment is rejected, you may file for reimbursement claim after the treatment.

Benefits of Buying Cashless Health Insurance

  • With cashless facility, you get the benefit of immediate treatment as you can get admitted to any of the network hospitals. You have to inform the insurance representative as soon as possible and post that the entire process becomes highly convenient.

  • To register as a network hospital, there are several quality checks, which help in ensuring that the policyholder gets good treatment at a reputed hospital. So, you get expert advice from trained medical professionals and receive advanced treatment without having to pay cash.

  • In case of a cashless claim, the documentation involved for the policyholder is lesser than what is needed in a reimbursement claim, as the insurance company and the hospital settle the bills between themselves.

  • The premium paid for health insurance is exempted from taxes under Section 80D of the Income Tax Act. So, apart from getting the peace of mind, you get to reduce your tax liabilities too.

  • Both pre and post hospitalization expenses are covered, which include diagnosis, treatment, medical expenses, doctor’s fees, etc., according to the capping as per your chosen policy. Special treatments like dialysis, chemotherapy, surgery expenses, room expenses (according to policy) and other daycare treatments are covered under cashless insurance too.

  • With cashless facility, you get the assurance that your savings won’t be drained to meet the medical expenses. Also, you won’t have to run around, looking for loans, to pay the hospital charges.

FAQs on Cashless Health Insurance

What if my cashless claim is rejected?

In case your cashless claim is rejected, you may have to pay for the medical expenses first and then claim the reimbursement later. Some of the reasons why the cashless claim may get rejected are:

  • Treatment availed at a hospital that is not covered by the list of network hospitals

  • Preauthorization request is not submitted within 24 hours in case of emergency and 48 hours before a planned hospitalization

  • Relevant documents are not submitted

  • Policy duration has expired, or renewal has not taken place

  • If the pre-existing medical condition was not declared while applying for the health insurance policy

  • If the medical condition is not covered or is listed under exceptions in the policy document


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