Cashless Health Insurance is Painless

This article first appeared on Moneycontrol.com.

An unforeseen medical emergency can mean an unexpected financial burden apart from the emotional stress that such an incident entails. To ensure that adequate financial resources are at our disposal during such emergencies, we sign up for a health insurance policy. However, while this measure affords us some peace of mind, the family of the patient is still required to fill in a plethora of forms and furnish initial amount at the time of hospitalization. Though this amount can be claimed later from the insurance companies, arranging the required some at such an hour could be quiet challenging, especially if the procedures are long and complicated. Cashless health insurance policies are designed specifically to relieve stress for the insured at the crucial moment of hospitalization.

Cashless health insurance

Cashless health insurance is a policy where the health insurance companies settle the hospitalization and treatment bills directly with the hospitals without the immediate involvement of the insured.  Under cashless health insurance scheme, Third-Party Administrators (TPAs) act as the bridge between the insurance companies and the hospitals. All the medical bills raised by hospitals are sent across to TPAs who then coordinate with the insurance companies to settle the claim. This process eliminates the need to furnish any amount at the time of hospitalization and also minimizes documentation required to avail medical services.

Cashless mediclaim service can be of two types:

  • Planned claim – When the insured is aware of the hospitalization in advance
  • Emergency claim – When immediate hospitalization is required due to serious illness or an accident

Cashless claim settlement process

Every health insurance company offering cashless insurance has a tie up with a number of hospitals which fall under their PPN (Preferred Provider Network). Cashless facilities can be availed at any hospital falling in the PPN of your insurance company.

To avail these services, the insured is required to fill a form furnishing the details required by the hospitals. This form is share with TPAs, who depending on the terms of policy, would share the limit of expenses covered under the policy and accordingly issue an authorization or denial letter to the hospital. Denial often happens where the required details are not furnished in the pre-authorization form. If the TPA does not approve your request, an alternative could be to pay the bill and reimburse it later. The hospital starts the treatment after receiving the authorization letter from TPAs. At the times of discharge, insurance company processes the claims up to the admissible limits in coordination with TPAs.

Benefits of cashless health insurance

Here are the three reasons why cashless health insurance should be adopted by every family:

  • Reduces tension in face of medical emergencies – In case of an emergency, the insured is not required to make any major payments towards hospitalization from his pocket. As a result of tie-ups with hospitals, insurance companies offer negotiated rates for various treatments which in turn help the insured to save on the sum insured under the health insurance policy.
  • Hassle free process- Not only does the cashless facility provide you with financial relief, it also enables smooth functioning in terms of documentation, since all coordination takes place between the hospital and the insurance company through TPAs. TPAs coordinate with the hospitals to furnish details such as bills, reports and prescription to the insurance company.
  • Quality treatment – Since most insurance companies tie up with leading hospitals in their respective cities, policyholders can be assured of quality treatment. It is, therefore, highly crucial to check the hospitals in the PPN at the time of taking the policy.
  • Retain emergency funds- We all maintain make some investments as an emergency fund to meet emergencies. These could be in the form of FDs, bonds or mutual funds. Since cashless insurance takes care of such emergencies, these investments can be rotated to earn better returns.

To make effective utilization of cashless health insurance policies, policyholders should be aware of the following dos and don’ts:

Do’s

  • As cashless service is only available in network hospitals, check the hospitals in the PPN of your insurance company at the time of taking the policy.
  • 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, laundry charges, amongst others.
  • In case of planned claim, inform your TPA before getting hospitalized. In case of emergencies, inform the TPAs within 24 hours of hospitalization.
  • Carry your cashless insurance ID card as proof at the time of hospitalization.
  • Furnish all the details required in the pre-authorization form within the requisite time frame so that the same is not rejected by the TPAs.
  • Submit all relevant medical documents, such as reports, claim forms, bills, etc., to the hospital before discharge.
  • As with all health insurance policies, reveal all pertinent details at the time of applying for a policy including any pre-existing condition. It might increase the premium amount slightly, but make sure that your claim is not rejected later.

 Don’ts

  • Do not submit ant fraud claims. It may not only lead to cancellation of your insurance plan but also make it difficult apply for a policy in future.
  • Avoid submitting small-budget claims, repeatedly to the insurance company as it will increase the premium amount to be paid and would eventually lead to claims getting disapproved.
  • Delay in intimating TPAs about hospitalization and furnishing incomplete pre-authorization form would work against the policyholder. Avoid doing that.

Technology Infusion:

To ensure that the entire cashless claim settlement is smooth, various participants in the process have embraced latest technology for quick claim settlement and adjudication. Almost every major healthcare insurance provider now has an online portal allowing patients, hospitals and TPA’s alike, a platform to digitally file for claims and process them. This has been a long overdue requirement and finally the industry seems to be moving in the right direction. While the first steps have been encouraging, a different portal for each healthcare insurance provider means that much needed standardization is missing. This is all set to change as innovative end to end solutions, like the one provided by Remedinet Technologies, will soon bring uniformity at all stages of the claim settlement process from pre-authorization to discharge. This has made cashless health insurance even more viable as an alternative to the traditional reimbursement insurance policies. Cashless health insurance definitely deserves a more serious look as part of your financial portfolio in the New Year.

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