Illnesses and physical injuries due to mishaps can exhaust your financial savings. This is the reason why having health insurance keeps you off from most of these expenses and helps you continue saving without any worries. When you raise a claim for health insurance, you get the option of either raising a cashless or a reimbursement claim. In a cashless claim, the bills are directly settled between the hospital and the insurer, and in a reimbursement claim, you pay and later claim the bill expenses with your insurer.
Either way is an option with almost all the major health insurance providers. Depending on your preferences and availability, you can go with any of these options. Let’s get into details and understand the differences between cashless and reimbursement claims.
What are Cashless Claims?
A cashless claim is one where the insured/policyholder does not have to pay admissible bills. The insurance company directly pays the bill amount to the hospital with the least trouble to the insured. A cashless claim is only possible at network hospitals (partner hospitals) of the health insurance company. Both emergency and planned hospitalisation are covered under cashless claims.
Pros of cashless claims
With a cashless claim, the insured gets to enjoy certain exceptional benefits as listed below:
- In the time of a medical emergency, you need not run around arranging hefty amounts during the course of hospitalisation as the insurer settles bills directly with the hospital
- The paperwork is limited with cashless claims. You just have to carry the ID of the insured or submit it within the deadline to the hospital and inform your insurer regarding the same
- You need not stress over the medical formalities as your insurer is there to settle the bills directly. So you get the peace of mind to concentrate on the treatment.
Cons of cashless claims
A cashless claim also has a few drawbacks. These are
- You can only avail of cashless claim benefits in a network hospital and none other. During an emergency hospitalisation, it may not always be possible to get admitted to a network hospital
- You must have all the required documents available, or else your cashless claim request may be rejected and you will have to raise a reimbursement claim later.
What are Reimbursement Claims?
A reimbursement claim is raised when the insured/policyholder pays bills from their pocket at the time of discharge from the hospital. Generally, a reimbursement claim is raised when the policyholder is admitted to a non-network hospital or fails to raise a cashless claim.
Pros of reimbursement claims:
Reimbursement claims have been a preferred mode of raising a claim for many. This is because of the following benefits it offers
- With a reimbursement claim, you can get admitted to any of your preferred hospitals
- There is no need to look for a network hospital to get medical assistance. The insured is free to visit any hospital, at his/ her convenience, especially in case of an emergency. The location of the hospital, be it in the vicinity or far away, is not a matter of concern as you can visit any hospital.
Cons of reimbursement claims
There are certain limitations that come along with a reimbursement claim, like
- You have to pay all the bills from your own pocket during the treatment procedure
- A reimbursement claim can only be raised once the treatment procedure is complete and the insured gets discharged
- There may come financial constraints as the insured cannot avail of financial aid from the insurer before completing the treatment process
- Because you have to pay from your own pocket until the treatment is done, you may not be able to afford the best medical facility in case of any financial limitations.
Cashless Claims vs Reimbursement Claims
The table below will guide you through quick details of cashless and reimbursement claims to help you establish the differences between them:
The insured has to first pay from their pocket and later raise the claim for the bills
The bills are directly settled between the hospital and the insurance company
Insured can visit any hospital of their choice and later raise the bills
The insured has to get admitted to one of the network hospitals to raise a cashless claim
You do not need any approval from the insurer before getting the medical treatment
For a cashless claim, you need to raise a request and get it approved within 24 hours in case of emergency hospitalisation and 72 hours before getting admitted in case of a planned hospitalisation
It may take up to a few weeks for the reimbursement claims to be processed
Cashless claims are usually settled immediately
A reimbursement claim requires you to submit all the bills of medical expenses and other documents as asked
A cashless claim has limited paperwork. You just have to fill out the form and submit the ID of the insured.
Which is better for you?
There cannot be a straightforward answer to whether a cashless or a reimbursement claim is the best one for you. The ideal preference may differ from one individual to another and also on the circumstances of hospitalisation. However, in case you want to keep your finances safe and do not make bill payments, a cashless claim is the best available option. If your preferred hospital isn’t a network hospital, reimbursement can be your ideal choice.
Things to remember when making a health insurance claim
Here are a few things you must keep in mind when raising a health insurance claim:
- Minimum hospitalisation hour
Health insurers generally require you to have a minimum of 24 hours of hospitalisation to raise a claim. Certain daycare procedures may be included in the policy or you may look for an add-on cover to extend the benefits of your plan.
- Know the limitations
Not just exclusions but the limit of the coverages must also be understood properly. For instance, the limit of hospital room charge may be less than what you are planning to rent. So, do contact your insurer beforehand to keep the norms clear between both parties or you may end up having to pay more than expected.
- Waiting period
During the waiting period for a health insurance policy, you cannot raise a claim. Depending on the type of plan chosen, the waiting period may be longer or shorter.
- Read about inclusions as well as exclusions.
Know all about what is not covered under your health insurance plan. This is essential, so you make an informed decision while receiving medical assistance.
Health insurance has become a basic need amid rising medical awareness. As the primary aim of health insurance is to help you raise medical claims in times of need, it is essential that you are well-informed about the same. The inclusions and exclusions of the plan and the process of raising a claim must be well-understood.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.