InvestorQ : What is cashless facility in health insurance?
Shreya Mashelkar made post

What is cashless facility in health insurance?

Shreya Karn answered.
3 years ago
As the name suggests, Cashless facility means that one can avail the facilities without paying the cash. Yeah, you heard it right! Well, it implies that the payment of your hospital bill will be settled by the health insurance provider and you don’t have to bear the burden of expenses. The plus point of a cashless facility in health insurance is that one doesn’t have to worry about the paperwork if the concerned hospital is listed with the health insurance provider. Also, the claim or expenses up to which a health insurance company settles the bill differs from case to case, depending upon the policy one has opted. If the insurance company is only liable to pay to Rs. 1 lakh and you have incurred the bill of Rs. 1,80,000, then the insurance company will pay only Rs. 1,00,000 while the rest Rs. 80,000 should be paid by the claimant.

Rishita Das answered.
3 years ago

As the name suggests, cashless facilities of health insurance are agreements various health insurance providers enter in to with various hospitals which state that patients holding cashless mediclaim policies will not have to pay the hospital for treatment. Instead, the charges will be paid directly to the hospital by the insurer.

In a cashless facility, the concept of network hospital comes into play. So, let’s try and understand what a network hospital means.

A network hospital is one among the wide network of hospitals created for providing cashless facilities to policyholders. If you have purchased a cashless health insurance, then your insurance provider would have had arrangements with certain hospitals or chains of hospitals and their different branches. It is this agreement that gets executed for your convenience when you get hospitalised and when you are looking for cashless facility.

It is important to note that you need to get admitted only to a network hospital that has prior arrangements in place with the insurance provider. Please note that if you were to get admitted in any other hospital, you may not be able to avail of the cashless facility.

Further, you would also be advised to check with your insurance provider, check the terms of your health policy, and check the websites of the hospital as well as your health insurance provider to ensure that the hospital you’ve chosen is a network hospital with all the required authorisations. This is done to avoid rejection of your claim at a later stage.

If you were to get admitted in a hospital that is not authorised and that does not have arrangements in place with your health insurance provider, you would still be eligible for Mediclaim. Under this, you can get your medical expenses reimbursed, within the terms and conditions of your health policy. It is important that you keep your insurance policy active and stick to the policy’s terms and conditions, which would be provided in the health insurance document. This can help you avoid rejection of claim, irrespective of whether you get hospitalised in a network hospital or not.

This brings us to another concept called “authorisation”. Authorisation refers to the process where your health insurance provider or third-party administrator (TPA) approves of the claims that you have put forth for cashless hospitalisation.

Please note, it can take a minimum of 24 hours for your claims to be verified and approved. If you got admitted to a network hospital to have a planned surgery, you would necessarily have to get authorisation from your health insurance provider. However, if it were an emergency that you get hospitalised for, the processing would be done at the earliest; lack of authorisation would not be a reason for claim rejection in such cases.


3 years ago

Cashless Health Insurance; in very simple terms, you as a patient have nothing to pay to the hospital towards your treatment. All claims are settled between the Hospital and the Insurance Company directly with your consent.

It works in a very simple way. If a procedure (say joint replacement) costs about 2 lacs with 3 days of hospitalization, the hospital sends across an estimate to the Insurance Company. Most hospital have a Room based package and hence room + procedure estimates can be arrived at. Basis the estimate, the Insurance Company approves an amount basis your policy. During discharge (or throughout the hospitalization), the patient then has to pay nothing to the hospital as long as the Insurance company has approved the coverage. All medicines and consumables until dischareg are also covered under this system.

Now even though an Insurance Policy covers you for medical expenses on hospitalization, the degree to which it covers what can vary as per the policy. So if you have a policy of 5 lacs that entitles you to a hospital bed @ 5000 a day, there is a good chance that as long as you are within the coverage parameters of the policy (room and associated package of 5000 or less) and will get a 100% cashless experience.

The cashless part goes for a toss in case you spend more than your limits; room charges of 7000 while you are entitled only for 5000. The differential then has to be paid by the patient.


prerna answered.
3 years ago

In health insurance is cashless ,if customer take health insurance, not everyone provides to the customers as cashless system but there is sum health plan they provides are as follow

1)34 critical illness cover for mens
(FOR ladies there is 36 critical illness).
2)Tax benefit 80 (D)-50000,10 (10)D-100% tax free amount.
3)reduce financial burden.
4)Family protection .
5)womenPremium is less than woman.
6)Customer can pay monthly, half yearly, Quaterly.
7)claim settlement ratio 97.67 of ten year avaerag.
8)if customer is have diagnose report then sum Assured will be credited to customer account


Purvesh answered.
2 years ago
There is always a hidden charge in such cases. Through my experience, I can say don't expect to get more than 80% of your total expenditure amount. Even the private corporate companies have the clause so be aware of this. Also, as per the clause, you can get claim max up to 1% per day of your Health Insurance Sum Assured.