Medical contingencies can sneak in at any point in time unexpectedly and a health insurance policy would be your saviour in such emergencies. Health insurance policy would provide cover for the expenses that are incurred in the treatment during an ailment or an accident. However, the most important concern in a health insurance plan is the claim settlement. It is the method by which you can avail the benefits and cover for which you have purchased the health insurance policy.

Health insurance claims in India can be settled by mainly two methods i.e. reimbursement claim settlement and cashless claim settlement.

Reimbursement Claim Settlement Process

Reimbursement Claim Settlement means that you will have to pay your medical bills out of your pocket and then get them reimbursed from your health insurance provider later. This situation will arise, if you have chosen a hospital of your choice and it is not listed with your medical insurance provider.

The procedure involved in reimbursement claim settlement can be stated below:

You will have to submit all original bills, invoices, prescriptions, reports and other necessary documents and your health insurance provider would map the documents against the coverage of your policy.
The documents to be provided would include a duly filled and signed claim form. Documents like KYC of both the insured and the policyholder, in case both are different; the doctor’s advice for admission and other prescriptions; hospital discharge summary; investigation and diagnosis reports; original pharmacy bills along with the prescriptions and receipts. And for the claim amount to be processed, the policyholder’s bank details for the NEFT transfer would be required. In the case of hospitalisation due to an accident, a copy of the FIR must be shared with the health insurance provider.
After the evaluation of the documents, the health insurance provider would make the payments to the policyholder according to the terms and conditions of the policy.
The insurance provider can ask for additional documents also to decide on the claim and in case a part of the claim is not admitted, they would provide a letter to the policyholder stating the exact reason for the rejection.

Advantages

The major advantage of the reimbursement claim settlement method is that you do not have to take any action immediately. Even if there is an emergency and you do not have the time to check the network hospitals, it is manageable as the reimbursement would be done later.

Also, some reimbursement health insurance plans are cheaper than cashless ones.

Treatment can be done in any hospital, irrespective of the same being a part of the empaneled network hospitals of the insurer.

Disadvantages

The reimbursement method of claim settlement is a tedious procedure. You will have to keep a track of all the necessary documents, bills, prescriptions, etc. and submit them on time for validation. This method of claim settlement takes quite a long duration of time and involves a lot of follow-up with the hospital and the health insurance provider.
The most important disadvantage is that the entire amount for the hospitalisation needs to be paid upfront and then claimed back from the insurance company. This might be difficult for some.

Cashless Claim Settlement

For a cashless claim settlement, the treatment has to be done in a network hospital. By providing the necessary details and by presenting the other physical proof, you can be able to claim the benefits of cashless hospitalisation.

a. Cashless claims for planned treatment

You will have to inform your insurance provider about the hospitalisation or treatment which is going to take place. This should happen at least 4 days before the date of treatment. This is called pre-authorisation approval.
A cashless claim request form would be sent to the insurance provider via fax or email. Then the insurance provider would inform you and the hospital authorities about the cover of the policy.
On the hospitalisation day, you would have to show your health insurance card and confirmation letter. Then the bills would be directly settled between your insurance provider and hospital.

b. Cashless claims for emergency treatment

You can connect with the customer care team of your health insurance provider and obtain information about the nearest network hospital. At the time of hospitalisation, you need to provide your health insurance card, KYC documents and obtain the cashless hospitalisation. You need to do the needful at the TPA desk of the hospital. However, all subsequent documentation, etc. would be taken care by the hospital.
The insurance provider would issue an authorisation letter to the hospital indicating the coverage with the bill. The medical bills would be directly settled by the insurance provider with the hospital.

Advantages

You will not have to pay the medical bills upfront, unlike the reimbursement claim settlement method. This would help in saving a lot of effort as you would already be in a state of stress due to the medical condition and additional financial stress would add to the burden.

Moreover, the cashless claim settlement procedure is fast-tracked and the insurance provider does not spend too much time in further validation and execution of the claim settlement.

Disadvantages

Sometimes, hospitals have different rates for the same treatment because of their tie-up with the insurance company. This might inflate the bill and exhaust a large portion of the insurance plan. However, if the same claim is done on a reimbursement basis, the bill might be much lower!

Which is better – Reimbursement or Cashless?

The cashless claim settlement method is definitely better than the reimbursement method because of its sheer convenience. The cashless method will spare you from the hassle of the financial stress which can arise due to the need to make payments. Health insurance deals with medical emergencies which already would create a burden. Amidst this stress, it is preferable not to be bothered about the payment of medical expenses from your pocket.

Conclusion

Hence, cashless mediclaim scores over reimbursement mediclaim mainly because of the convenience it offers. The reimbursement method is not flawed but it is just tedious and slow. However, you must do proper research before purchasing a cashless mediclaim too. You must compare policies online and purchase a good cashless mediclaim with optimal benefits.

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