What Are The Challenges of a Cashless Mediclaim Policy?

In cashless health insurance, the insurance company will directly settle the applicable amount with the hospital. You, the policyholder, will only have to pay the predetermined co-payment or deductible amount.
However, for a successful cashless claim settlement, there are two important components of cashless health insurance to note:

Preferred Provider Network (PPN) or cashless network hospitals : Insurance companies tie up with certain hospitals to enable cashless treatment and hospitalisation. Thus, PPN is basically a network hospital which has partnered with your insurance company to offer cashless claim benefits.

Third-Party Administrators (TPA) : A TPA is basically the authorised mediator between the policyholder and the insurance company. It assists the insurer with claim processing, document collection and verification and claim settlement. Policyholders need to select their TPAs while buying/renewing the policy. Some insurers do not have a TPA and take care of claim processing in-house.

Now, this is how a cashless health insurance plan works: The insured member gets admitted to a PPN hospital where their authorised TPA/insurance company offers cashless treatment support. They need to provide the insurance certificate/health card to the hospital for verification.

• A duly filled pre-hospitalisation form has to be submitted to the TPA/insurance company, post which the TPA/insurer will provide a cashless treatment authorisation form.

• Upon completion of the treatment, the hospital will provide an invoice containing a breakdown of the expenses to the TPA/insurer.

• Based on the nature, extent and scope of the health insurance policy, the TPA/insurer will settle the bill.

• The insured member will have to pay any copayment/deductible amount, along with any proportion of the expenses which were not covered under the cashless mediclaim policy and therefore not settled by the insurer/TPA.

Now that we know the meaning and process of cashless claim settlement let us look at the major challenges that it poses.

1. The total bill is not settled by the provider : Sometimes, the TPA/insurance company only settles a part of the total treatment and hospitalisation expenses incurred. This can be due to multiple reasons, such as:

• A part of the treatment/expense is not covered under the cashless health insurance policy, and therefore, the insurance company will not pay for it. For instance, you are hospitalised for Covid-19 treatment, and the doctor conducts certain additional tests, outside the purview of Covid treatment as well as your policy coverage, due to your past medical history. Those additional tests will not be covered by the insurance company.

• You can opt for a staggered structure wherein you undergo the planned treatment first and get a cashless settlement for it. However, you develop complications during recuperation and have to undergo further treatment. The latter part of the expenses is not a part of the initial cashless treatment authorisation and can be filed as a reimbursement claim later.

2. A cashless claim benefit is not available : TPA or insurance companies require proper intimation and time to process cashless insurance claims. However, in case of emergency surgeries or procedures, the TPA/insurer does not get the necessary time.

As a result, despite being admitted to a network hospital and having cashless health insurance, the insured is requested to pay for the expenses and then file for a reimbursement claim.

3.The documentation can get confusing : Proper and complete documentation is a prerequisite for a successful cashless claim settlement. The pre-authorisation form is especially important to process and authorise any cashless treatments and claims.

If the policyholder fails to submit a duly filled pre-authorisation form or any other necessary documentation on time, it can lead to challenges in ensuring a cashless insurance claim.

Cashless mediclaim policies are highly advantageous for policyholders as they truly satisfy the objective of a health insurance policy - ensuring that the burden of hospitalisation expenses does not befall the policyholder. The challenges we discussed above can be easily tackled by being aware of the nature and scope of your health insurance plan.

Here are a few ways in which you can tackle the challenges of cashless claim settlement.

Check out network hospitals : Even before you finalise a health insurance plan, go through the list of its network hospitals. Three types of hospitals should be a part of your cashless mediclaim policy’s network:

1. Hospitals in the vicinity for emergency hospitalisation
2. Your preferred hospitals where you generally go for treatments and procedures
3. At least 1 top hospital in your city/region for advanced treatments and procedures

A wide cashless hospital network allows you to avail yourself of the best possible treatment at the hospital of your choice in any part of the country without worrying about the expenses.

• Check the inclusions and exclusions of your policy: Make a note of all the treatments and procedures that are not covered under your cashless health insurance policy, especially before you plan the treatment or get hospitalised.
  If the treatment is not covered under your cashless mediclaim policy, you will need enough time to source and keep ready the necessary funds required for the expenses.

• Get the documents ready : A pre-authorisation form is the most important component of your cashless claim. For emergency hospitalisation, it needs to be submitted within 24 hours of getting hospitalised. For planned treatments, the form should be submitted 4-5 days prior to the hospitalisation.

Additionally, a proper and complete set of invoices, receipts and bills need to be submitted to the TPA for seamless and full cashless settlement. Keep the insurance certificate or health card handy and accessible to all members of the family. Educate your family members as well about the documentation and claim settlement process.

A cashless mediclaim policy is definitely preferred by and convenient for policyholders. However, you may encounter certain challenges if you are not well versed with your health insurance policy details and claim settlement process. Therefore, take proper measures and educate yourself and your family members about the due diligence required to ensure a smooth and stress-free cashless insurance claim settlement.

With 7200+ cashless claim hospitals across India, inbuilt COVID cover, 24x7 customer support and a claim settlement ratio of 94.21% (FY 2020-21), Tata AIG offers health insurance plans that you can trust. Our Medicare range of health insurance policies offers three variants that cater to the unique needs of insurance seekers and offer comprehensive coverage. You can use our online health insurance calculator to compare the different health insurance plan variants and find the policy that suits your insurance needs and budget.