Verify hospital's cashless status before admission to avoid claim hassles

If reimbursement becomes unavoidable, submit a complete file at the earliest

A recent Policybazaar survey found that cashless claims provide health insurance customers with a better experience than reimbursement claims. The survey covered 2,228 customers across metros and Tier-II and Tier-III cities.

 

Why cashless works better

 

Cashless claims offer a simpler and more seamless experience. The insurer settles the hospital bill directly, so the customer does not have to pay out of pocket. “This reduces the need to arrange a large sum during hospitalisation,” says Shilpa Arora, co-founder and chief operating officer, Insurance Samadhan.

 

Cashless treatment is available at hospitals in the insurer’s network. These hospitals follow negotiated package rates and have a dedicated insurance or third-party administrator (TPA) desk, which coordinates with the insurer on the patient’s behalf. “This coordination helps speed up authorisation,” says Arora.

 

They submit the documents to the insurer. “The customer is spared the burden of documentation,” says Amit Chhabra, chief business officer, Policybazaar. 

 

When reimbursement becomes necessary

 

Customers usually file reimbursement claims when the hospital is outside the insurer’s cashless network. A medical emergency may also force the customer to go to the nearest hospital. “The customer may not have the time to check whether the hospital is in the insurer’s network,” says Arora.

 

Some patients continue with a doctor or hospital they have trusted for years. At times, they may choose a reputed hospital that does not have a cashless tie-up with their insurer.

 

Many policyholders are unaware of which hospitals are empanelled. “Some assume that every hospital offers cashless treatment and discover the gap only at admission,” says Arora.

 

Cashless approval at the time of discharge typically takes three to four hours. “Some customers do not want to wait and leave the hospital. They then file a reimbursement claim later,” says Chhabra.

 

Sometimes, insurers deny cashless claims

 

Insurers may deny a cashless claim if they suspect fraud. “Fraud may involve a customer who is not actually hospitalised,” says Chhabra.

 

Non-disclosure of an existing medical condition at the time of policy purchase is another common ground for denial. “A pre-existing condition that still falls within the waiting period can also lead to denial,” says Arora.

 

Sometimes, the issue is procedural. “Authorisation may remain pending if the insurer needs additional medical records or clarification from the treating doctor,” says Arora.

 

Downsides of reimbursement

 

Cashless settlements are based on package rates that insurers have already negotiated with hospitals. “If the patient pays out of pocket, the hospital may charge its standard billing rate, which is usually higher,” says Arora.

 

These claims usually arise at non-network hospitals, where insurers do not have pre-agreed arrangements. “The insurer may scrutinise every bill line by line and seek additional medical records, which can lengthen the processing time,” says Arora.

 

Insurers lack standardised billing, so they must independently assess whether the charges are reasonable and whether the treatment was medically necessary. This can necessitate a more detailed review than cashless claims.

 

“Reimbursement claims can lead to partial settlement or repudiation if documentation does not fully support the claim,” says Arora.

 

Documentation burden is higher

 

The document requirement may be similar for reimbursement and cashless claims. The key difference lies in who submits the papers. “In reimbursement claims, the customer has to organise and submit the documents and fill out the forms,” says Chhabra.

 

Delays can hurt finances

 

If the documentation is in order, reimbursement claims usually get settled in seven to 10 days, though the standard timeline for settling them is 30 days. The settlement window may extend if the insurer asks for a missing document or raises a medical or policy-related query. “The policyholder may have to go back and forth between the hospital and the insurer to gather additional information, causing delay,” says Arora.

 

Reimbursement claims may also take longer if the customer delays responding or if an inspection is carried out.

 

Every extra day that a claim remains open leaves the policyholder carrying the cost of hospitalisation. “The strain becomes serious when money is arranged through a credit card or a personal loan,” says Arora. 

 

How to avoid reimbursement

 

Customers should apply for cashless approval well in time. “For planned hospitalisation, they should apply at least a day or two before treatment,” says Kapil Mehta, co-founder, SecureNow Insurance Broker.

 

Some insurers may have a tighter window. “Customers should confirm the exact intimation window for their policy,” says Saurabh Vijayvergia, founder and chief executive officer, CoverSure. As soon as hospitalisation is confirmed, they should inform the insurer, since delayed intimation is one of the key reasons for cashless requests turning into reimbursement claims.

 

Vijayvergia says that customers should respond promptly to pre-authorisation queries to prevent their approval from lapsing. “They should also check the hospital’s cashless status immediately before admission as the insurer’s network can change,” he says.

 

Before discharge, customers should ensure the hospital puts all papers together and sends them on time. “If the insurer is under time pressure, it is more likely to ask the customer to file a reimbursement claim,” says Mehta.

 

Steps to improve outcome

 

Customers should review the hospital bill every day during treatment. “Billing errors are easier to correct while treatment is ongoing and harder to correct after the final bill is generated,” says Vijayvergia.

 

They should also anticipate questions around the need for hospitalisation or whether the ailment could be treated as pre-existing. “If such questions are likely, the customer should submit a note explaining their position clearly,” says Mehta.

 

Customers should submit the complete set of documents together, rather than in batches. “The document-submission window is 15 to 30 days from discharge. Filing within the insurer’s prescribed window helps avoid friction,” says Vijayvergia.

 

Customers should use digital claims infrastructure wherever it is available. “The National Health Claims Exchange can speed up document transfer and status tracking where both the hospital and insurer are on the platform,” says Vijayvergia.

 

If claim stalls

 

If a claim stalls, the customer should first escalate it to the insurer’s grievance officer. If it remains unresolved, they should take it up on the Bima Bharosa grievance portal. If the issue still remains unresolved, the customer should approach the insurance ombudsman.

 

Dos and don’ts

 

Some customers avoid cashless claims for convenience, particularly when the claim amount is small. “Skipping cashless to save a few hours at discharge can create a bigger problem later,” says Arora.

 

Customers should not delay filing reimbursement claims. “Delays can make documents harder to obtain and prompt the insurer to question why the claim was filed late,” says Mehta. 

 

They should preserve original bills and other documents carefully during hospitalisation. Before sending documents to the insurer, they should keep scanned copies for their own records.

 

“Customers should keep the claim number given by the insurer and use it to track the claim,” says Mehta.

 

Finally, customers should not ignore small mismatches. “A misspelt name or a mismatch in dates between the claim form and hospital records can cause avoidable delay,” says Vijayvergia.

 

Get the paperwork right 

•    Preserve the initial diagnosis, discharge summary, prescriptions and diagnostic reports

•    Collect the original itemised hospital bill with seal, signature and GST number

•    Preserve receipts for every payment made

•    Submit a fully completed claim form signed by the patient and the hospital

•    Provide bank account details, photo identity proof and policy copy