What is the Difference Between a Cashless and Reimbursement Claim in Health Insurance?


Health insurance is your safety net, ready to catch you when you fall ill or get injured, whether it’s a planned medical procedure or an unexpected health crisis. You can claim your health insurance in two ways: cashless and reimbursement. Both methods give you financial help, but they work differently. Knowing the differences between them is important to ensure your claim goes smoothly.

Navigating the claim processes in your health insurance policy can be a lifesaver, both literally and financially. In India, the two primary methods of settling health insurance claims are cashless and reimbursement claims. Understanding the differences between these two can help you make more informed decisions during medical emergencies. Let’s simplify these concepts and see how each process works.

Let’s Understand Health Insurance Claim

A health insurance claim is when you ask your insurance company to pay for medical expenses covered by your policy. To make a claim, you must submit details of your medical costs and any necessary documents. The insurance company will then review your request.

If everything is in order, they will process your claim and provide the benefits you’re entitled to. Thanks to technology, you can now file health insurance claims online, making the process quicker and easier.

Health insurance claims are of two types – cashless claim and reimbursement claims.

What is Cashless Insurance Claim?

The cashless claim benefit is for policyholders who get medical treatment at hospitals that are part of their insurance provider’s network. These network hospitals have agreements with the insurance company or a Third-Party Administrator (TPA) to offer cashless claims. You can find a list of these hospitals in your policy documents or on the insurer’s website, TPA portal, or TPA website.

When you need hospitalisation and have medical expenses, you must request approval from the insurance provider or the TPA. Once approved, you can start your treatment. After receiving your request, the insurer checks the details with the hospital and pays the medical bills directly.

Key points about cashless claims:

  1. Health  forinsurance providers have a wide network of hospitals to ensure policyholders get quality and timely treatment faster recovery.
  2. These network hospitals are located across the country for easy access.

What Is Reimbursement Claim?

The reimbursement claim benefit is for policyholders who get medical treatment at any hospital they prefer.

First, you pay all the hospital and medical bills yourself. Then, you request reimbursement from your insurance provider by submitting the necessary bills and invoices.

Once they receive your request, the insurer or TPA will check the details and documents. They will pay you back according to your policy coverage if everything is in order.

Cashless Claim Process

Choose a network hospital and get your treatment approved by your insurer beforehand. Please complete the necessary forms by showing the hospital your health e-card and proof of ID. Submit these forms to the Third-Party Administrator and insurer. Then, wait for your claims to be processed and settled.

Reimbursement Claim Process

Get your treatment and keep all the documents and bills. After that, complete the necessary forms and submit the documents to your insurer. Then, wait for the insurer to process your reimbursement.

Cashless Claim Settlement

The insurer will pay the hospital directly on your behalf, so you won’t need to make any upfront payments.

Reimbursement Claim Settlement

First, you must pay for all hospital expenses out of your pocket. Later, the insurer will reimburse you for these expenses.

Claim Approvals

For cashless, you must obtain approval from the insurer before your hospital visit. You should do that for planned hospitalisations at least 72 hours in advance and medical emergencies within 24 hours.

You are not required to obtain approval for your claim beforehand to receive reimbursement. However, confirming with your insurer whether your treatment will be covered under your policy is advisable.

Duration for Claim

Cashless claims are typically settled immediately at the time of claim processing.

Reimbursement claims are processed after your treatment. Due to the need for document verification, this process typically takes 2 to 4 weeks.

Documents Required for Claims

With a cashless claim, you only need to complete the form provided by the hospital’s TPA. You do not need to submit bills or additional documents.

You must submit your health invoices for reimbursement, including medical bills, doctor’s prescriptions, and other pertinent information.

Applicable for Which Hospitals?

Cashless claims only apply to your insurer’s network hospitals. In contrast, reimbursement claims can be submitted at any hospital, regardless of whether it is a network hospital.

Final Thought

Both cashless and reimbursement claims have their advantages and challenges. Cashless health insurance provides immediate financial relief and convenience if you choose a network hospital. On the other hand, reimbursement claims offer greater flexibility when choosing a hospital. Still, you need to manage the initial expenses and paperwork.

When choosing a health insurance policy, consider your medical needs, financial situation, and hospital preferences. Being informed about the claim reimbursement process and understanding cashless insurance can help you easily navigate medical emergencies and maximise your health insurance benefits.

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