Decoding cashless health insurance

Dr Prakash

An accident or an ailment never comes with a notice period. No matter how organised you are, one is never really prepared for those times when a loved one is faced with a medical emergency requiring immediate hospitalisation. Cashless health insurance allows you to leave your wallet worries at home and focus on getting the best available care for the patient.

Typically, health insurance policies fall under two broad categories.

The reimbursement type, where the hospital bills are paid upfront and the insurance is claimed later, or, the cashless kind, where the health insurance company settles the bill directly with the hospital through a third party mediator (TPA). The TPA is normally an outsourced client. Insurance firms have tie-ups with a select group of hospitals as part of their preferred provider network, or PPN in insurance parlance. To avail of a cashless facility, you must only be admitted in a PPN-approved hospital.

Advantages

• It cuts down the need for emergency cash while getting the insured admitted or during the period of hospitalisation. Inform the TPA before you get admitted and remember to carry your health identity card, issued by the insurance firm at the time of signing up.

• The insurance firm pays the entire bill amount, up to the sum insured, during the hospitalisation period.

• While applying for cashless, please note the insurance company peruses the documents and indirectly offers free second opinion.

• Last but not the least, it eliminates the stress associated with waiting for the reimbursement to come through after a claim has been filed.

Disadvantages

• In an event, where the insured has been admitted to a hospital outside the insurer’s PPN, the hospital bills will have to be paid upfront, claimed and reimbursed by the insurer later.

• Since the liaisoning between the insurance company and the hospital is done by a third party administrator, expect delays unless the insurance firm liaisons directly with the hospital.

• Sometimes hospitals have a tendency for over billing, or the insured may choose to get admitted to a high-end facility on the assumption that the bills will be settled by the insurer. Here there are rooms for confrontation.

• The insurer has the right to change its list of PPN any time. So, the customer can contact the toll free number.

• It would help to remember that in essence, cashless insurance is the password to stress free medical care and recovery, provided you make an informed decision.

As you purchase any health insurance policy, before you sign up, please read carefully between the lines. It is important to verify if the PPN includes hospitals that offer quality medical care or, in case of a medical emergency, is in a location convenient for you.

Secondly, the sum insured is the maximum limit that the insurer will pay directly to the hospital, at the time of bill settlement. Expenses beyond the insured sum will have to be borne by the insured. Be aware of the non-admissible charges under your insurance policy cover, such as service charges, administration charges, registration charges, private nurse expenses, telephone calls and laundry charges, among others. Third, tax benefits are subject to changes in taxation laws.

The author is Executive Director, Star Health and Allied Insurance. The views expressed in this article are his own