Health insurance is one of the best investments you can make. It comes to your rescue, especially during unplanned or emergency hospitalisation. Most customers focus on the premium amount and the sum insured to decide on a health insurance policy; however, there are various other benefits that we sometimes overlook. 

Cashless Health Insurance – Types, Features and Benefits - Acko
Cashless Health Insurance

The cost of healthcare is inflating every day in India, and along with the hassle of raising a claim and getting reimbursed, medical insurance is sometimes cumbersome or difficult. So, how to choose the best health insurance plan? While there are several features and benefits that your medical insurance should provide, one of the most important benefits is “Cashless Health Insurance”.

What is Cashless Health Insurance?

One of the challenges we face during hospitalisation is paying the required medical fees and completing lengthy paperwork during medical emergencies. All these hassles can be eliminated through the process of cashless hospitalisation. It avoids the hassle of reimbursement and the difficulties of arranging funds to pay your medical bills. 

Cashless health insurance lets you settle medical bills directly to the hospital, facilitated by the insurance company. To avail this benefit, you can claim up to the sum insured and the hospitalisation should be at one of the network hospitals listed by the insurance company.

Features of Cashless Health Insurance:

Now that we understand what is cashless health insurance, below are the features of cashless health insurance policies that you should be aware of:

  • Pre- and post-hospitalisation expenses.
  • Planned or unplanned hospitalisation.
  • Emergency hospitalisation.
  • A wide network of hospitals.
  • No-Claim Bonus (NCB).
  • In-patient treatment cost.
  • Preventive health check-ups.
  • Day-care expenses.
  • Ambulance expenses coverage.
  • Domiciliary treatment coverage.
  • Income tax benefit.
  • Free-look period.
  • Critical illnesses coverage.

Types of Cashless Health Insurance Policies in India:

Cashless medical insurance is broadly categorised into three types of policies, they are:

Cashless Individual Health Insurance:

Cashless hospitalisation is provided to individuals who have opted for an individual health insurance policy.

Cashless Family Floater Health Insurance:

Under this type of cashless health insurance, all the family members, who are the beneficiaries of the insurance plan, can avail cashless hospitalisation and the benefits of the policy.

Cashless Senior Citizen Health Insurance:

This type of cashless health plan offers coverage to senior citizens which offers benefits such as hospitalisation costs, ambulance costs, amongst others, as per the terms and conditions of the contract.

How Does a Cashless Health Insurance Work and What are its Benefits?

When you or your family members (beneficiaries) of the health insurance policy get admitted to one of the network hospitals, the insurance company and the hospital will work together to settle medical expenses arising out of the hospitalisation. You can claim up to the sum insured for the medical expenses.

You can raise a claim for the expenses incurred through two methods: cashless and reimbursement. Read on to find out the difference between the two.

Cashless Claim:

To avail the cashless hospitalisation benefits, you need to get admitted at one of the network hospitals listed by your insurance company.

Reimbursement Claim:

While insurance companies offer the benefit of cashless hospitalisation at one of their network hospitals, there may be a situation where you might have to get yourself admitted at a non-network hospital. In this situation, you need to pay the hospital bill in full and then raise a claim with your insurer to reimburse the expenses.

Cashless Hospitalisation Benefits:

Cashless hospitalisation offers several benefits to the policyholder, read on to find out the details:

Reduces Financial Burden:

Cashless hospitalisation or health insurance policies are useful especially during unplanned or emergency situations. During this time, there may be a situation to arrange funds for the hospitalisation costs, this is where cashless insurance plans or hospitalisation comes to your rescue. It acts as a financial cover during hospitalisation and you don’t have to pay from your pocket.

Wide Coverage:

Most of the insurance companies offer to cover pre- and post-hospitalisation costs, domiciliary hospitalisation, ambulance charges, in-patient care, amongst others. Some insurers even provide preventive health check-ups or diagnostics tests part of their policy. However, the coverage might vary between insurance companies and it’s advisable to read the terms and conditions before choosing the right insurance policy.

Peace of Mind:

Instead of worrying about how to arrange funds during hospitalisation, cashless treatment offers to pay the bills, thereby offering you the peace of mind. You also get to visit some of the best hospitals to avail of quality healthcare.

Tax Benefits:

The premium that you pay towards the medical insurance plan is eligible for tax benefits under Section 80D of the Income Tax Act, 1961. The maximum amount that you can claim tax benefits may vary every financial year. Do check the most updated tax benefits of health insurance policy to take advantage of the same.

Offers Coverage While Travelling:

There may be a situation of a medical emergency while travelling, especially if you are in an unfamiliar place. You can visit any of the network hospital listed by the insurer to avail emergency hospitalisation without having to worry about medical expenses.

Cashless Hospitalisation Claim Process:

Generally, the below steps are followed to raise a claim for the hospitalisation of the admitted person:

Step 1: Doctor advises hospitalisation or you or your family might be hospitalised due to an emergency.

Step 2: Intimate your insurer about the hospitalisation.

Step 3: If it’s a cashless claim, then you need to avail the cashless facility at any of the network hospitals. And, if it’s a non-network hospital, then you will have to raise a reimbursement claim after paying the hospital bill.

Step 4: If it’s not a cashless claim, you will have to pay off the hospital bill in full and then raise a claim with your insurance company to reimburse the expenses.

Documents Required for Cashless Hospitalisation:

To avail or to initiate the cashless hospitalisation, the below documents are required:

  • Filled health insurance claim form.
  • Patients discharge summary.
  • Copy of your health insurance card.
  • Cancelled cheque in case of reimbursement.
  • Original medical bills and receipts.
  • Prescription and cash invoice.
  • In case of accident, Medico-Legal Certificate (MLC) or FIR.
  • Investigation reports (X-ray/ECG/Laboratory).

Also, read: Health Insurance Premium Calculator

Why is Cashless Health Insurance Important?

Be it planned or unplanned hospitalisation, we need funds to pay medical expenses for healthcare. Cashless insurance policies offer several benefits to the policyholder and their family. Let’s understand why cashless health insurance is important.

  • Protects high and unexpected medical care expenses.
  • The outcome of the coverage provided by a good medical insurance policy outweighs the premium that you pay for the policy less than the amount required to pay out of your pocket.
  • You can avail quality medical care, which is expensive, through the cashless insurance plan. It acts as a cushion in case of emergency hospitalisation.
  • It offers comprehensive coverage by covering costs towards doctor fees, medical tests costs, pre- and post-hospitalisation costs and ambulance expenses.

How to Avail Cashless Insurance?

Hospitalisation can be planned, however, there are circumstances when there can be an unplanned or emergency hospitalisation. Let’s look at different situations of hospitalisation and how cashless insurance works in each of these situations:

Cashless Insurance During Planned Hospitalisation:

Follow the steps below to avail cashless insurance in case of a planned hospitalisation:

Step 1: Doctor advises hospitalisation.
Step 2: Inform your insurer about the planned hospitalisation.
Step 3: Ensure the hospitalisation is at one of the network hospitals listed by the insurance company.
Step 4: Get yourself admitted to the hospital and inform the hospital authorities about the cashless insurance facility.
Step 5: Present your health insurance card or provide the insurance policy number to the hospital authorities.
Step 6: Fill the pre-authorisation form with relevant details.
Step 7: The hospital will coordinate with the insurance company or the Third-Party Administration (TPA) about your hospitalisation under the cashless facility.
Step 8: After the insurance company authorises your claim, your cashless hospitalisation will be initiated by the hospital.
Step 9: Upon discharge, ensure you verify and sign all the medical bills.

Cashless Insurance During Emergency Hospitalisation:

Medical emergencies come unannounced. To avail cashless hospitalisation during such circumstances, follow the steps below:

Step 1: Get admitted to the hospital.
Step 2: Duly fill the pre-authorisation form and provide the policy number or the health insurance card
Step 3: The hospital will coordinate with the Third-Party Administrator (TPA) or the insurance company to authorise your hospitalisation.
Step 4: Upon authorisation, your cashless hospitalisation will be initiated.
Step 5: Upon discharge, verify the medical bills and sign it.
Step 6: Obtain a copy of the medical bills and the discharge summary for future reference.

Check: Things to Know About Health Insurance Waiting Period

What is Cashless Claim Settlement?

When your claim for hospitalisation expenses are paid by the insurance company and you don’t have to pay is known as cashless claim settlement.

Difference Between Cashless Claim and Reimbursement Claim

Both these types of claim are offered by most of the insurance companies. However, they differ in features and how they work, let’s look at the difference between the two claim process:

Cashless Claim Reimbursement Claim
Don’t have to pay medical costs yourself. Have to pay medical costs first.
Insurance company settles the bill directly with the hospital. Insurance company settles the costs with you after you pay for hospitalisation.
Treatments only in a network hospital. Treatments in any hospital.
The claim is settled immediately. Reimbursement claims take time.
Hassle-free process. Process of claim request is tedious.

Things to Consider Before Buying Cashless Health Insurance Policy:

Before you go ahead and purchase a cashless health insurance plan, consider the below points to make the right decision:

  • Network Hospitals: Ensure you check cashless network hospitals with the insurer. A high number of network hospitals offers you several choices.
  • Inclusions and Exclusions: Your insurance company will bear all costs which include hospitalisation, ambulance, and other related expenses. However, there are exclusions which you should be aware of as well.
  • The efficiency of Servicing a Claim: Ensure you know the Claim Settlement Ratio of the insurance company so that your claim request service is excellent.
  • No-Claim Bonus: Check if the insurance policy offers a no-claim bonus (NCB) for not raising any claim during the policy period as this could be a discount while renewing the policy.
  • Pre- and Post-Hospitalisation Coverage: Insurance companies offer pre- and post-hospitalisation costs; however, some do not. Hence, check if the insurance policy covers both pre- and post-hospitalisation expenses.
  • Maternity Benefits: With medical costs escalating every day, maternity costs have increased accordingly, hence, you need to choose medical insurance which offers to cover costs related to maternity.
  • Medical Check-ups: Several insurers offer to cover medical check-ups. Choose an insurance company which offers medical check-ups as a part of their policy.
  • Selecting the Insured Declared Value (IDV): Select the sum insured wisely as it covers expenses arising out of hospitalisation for the policy period. Ensure you do not choose an IDV which does not cover you extensively especially during an emergency.

Also, read: Maternity Health Insurance

What is Covered in a Cashless Health Insurance?

Generally, insurance providers offer different coverages in their health insurance policies. However, there are some standard coverages that are part of the cashless health insurance plan, below are the details:

  • Pre- and post-hospitalisation expenses.
  • In-patient care.
  • Daily cash allowance.
  • Ambulance services.
  • No-claim bonus (NCB).
  • Domiciliary treatment expenses.
  • Medical check-ups.

Also, check: Arogya Sanjeevani Health Policy

Advantages of Cashless Health Insurance Policy:

Apart from the advantage of cashless hospitalisation, they offer several other advantages. Below are the details:

  • Robust Financial Coverage During Emergencies: Medical emergencies come unannounced and could dent your savings when we don’t plan them in advance. Cashless medical insurance policies cater to this situation by bearing unexpected medical costs.
  • Peace of Mind: You can rest assured that the cashless health insurance will come to your rescue during planned or unplanned hospitalisation without worrying about emergency funds to pay for the expenses.
  • Tax Benefits: You can claim tax benefits for the premium you pay towards health insurance policies under Section 80D of the Income Tax Act, 1961.
  • Extensive Range of Coverages: Generally, insurers offer an extensive range of coverages under cashless medical insurance plans which includes critical illnesses, pre- and post-hospitalisation expenses, domiciliary treatment costs, ambulance services, amongst others.
  • Coverages During Travel: While travelling to a new place, cashless health insurance policy removes the hassle of paying from your pocket since the insurance company will directly settle the bill with the hospital. Ensure the hospital is part of the network hospitals.

FAQs about Cashless Health Insurance Policy:

Here are some frequently asked questions about cashless medical insurance policies:

What are the types of cashless health insurance policies in India?

Typically, there are three types of cashless medical insurance policies: individual, family floater and senior citizen.

Can cashless health insurance claim be denied?

Yes, it could be denied under the following situations:
1. If the medical condition is not covered by the policy.
2. If the hospital is not part of the network hospitals listed by the insurance company.
3. If the information provided by the network hospital lacks the required information.
4. If you do not send the pre-authorisation form on time.

What is the tenure of the cashless health insurance plan?

Similar to other insurance products, cashless health insurance plans come with a one-year policy; however, some insurers do offer tenures of two years.

How many claims are allowed in a year in a cashless health insurance policy?

You can claim several times during the policy period subject to a maximum of the sum insured amount.

Do cashless health insurance plans cover pre-existing diseases?

Some insurance providers offer to cover pre-existing diseases subject to terms and conditions set by the insurance company.

Read informative Health Insurance Articles at Acko.

Read all our insurance & non insurance related articles here.