Why You Should Buy Cashless Health Insurance for Your Family

A cashless health insurance policy offers the benefit of immediate access to healthcare services without the concern of settling hospital bills and treatment expenses upfront. This is the reason why a significant number of insurance companies now offer extensive benefits through cashless health insurance policies.

Read on to understand the significance of a cashless health insurance policy, its functioning, and why you should buy cashless health insurance for your family.

What Is Cashless Health Insurance?

Opting for cashless health insurance eliminates the need to arrange cash for medical expenses, as the insurance company directly covers your hospital costs.

Every health insurance company has a specific network of hospitals. For instance, suppose your health insurance company has affiliations with 2,000 hospitals across India. If you encounter a medical emergency and wish to utilise the cashless facility, you must receive treatment from an insurer's network hospital. This means your treatment should be sought from a hospital affiliated with the insurance company.

There are two types of cashless claims:

Planned Claim:

Planned claim is applicable when you are aware of an upcoming hospitalisation at least 2-3 days in advance. In such instances, you need to complete a pre-authorisation form before hospitalisation. The insurer will then review and either approve or reject the claim.

Emergency Claim:

In the event of a medical emergency, such as an accident or severe illness, you can still make an insurance claim. In emergencies, it is crucial to inform the insurer about the ongoing treatment as soon as possible. According to the standard procedure, the insurer is expected to process the claim within 6 hours.

What Are the Features of Cashless Health Insurance?

• The insurance company takes direct responsibility for covering medical expenses.

• To access this service, the patient must be admitted to one of the network hospitals.

• It is essential to maintain copies of necessary documents like diagnostic reports, medical bills, discharge summaries, and the claim form.

• The insurance company bears the medical costs within the limits of the sum insured coverage.

• If the expenses exceed the sum insured, the policyholder is responsible for covering the excess amount.

• Any expenses surpassing sub-limits predetermined by the health insurance policy or items not covered under the policy must be settled by the insured.

What Are the Benefits of Buying a Cashless Health Insurance Policy for Your Family?

1. Comprehensive Coverage:

A cashless health insurance policy provides a convenient way to utilise health insurance, offering comprehensive benefits, including the settlement of medical bills, medical treatment, ambulance expenses, and more.

2. Immediate Access to Treatment:

Having a cashless health policy enables easy access to immediate treatment without the concern of overwhelming hospital bills. During emergencies, you simply need to inform the hospital helpdesk within 24 hours, and for planned hospitalisation before 2 to 3 days.

3. Nationwide Coverage:

With a cashless insurance policy, you can receive treatment at any network hospital nationwide, addressing medical issues that may arise during travel.

4. Tax Savings:

Premiums paid for cashless health insurance policies for families, individuals, or senior citizens are eligible for tax exemption under Section 80D of the Income Tax Act.

How Does Cashless Health Insurance Work?

Health insurance companies collaborate with various hospitals nationwide after evaluating their quality, reputation, pricing, and the scope of procedures covered. These hospitals, known as network hospitals, undergo comprehensive background checks by insurance companies. The cashless insurance option is exclusively applicable in these network hospitals. Therefore, you can benefit from the cashless facility if you choose to be admitted to one of these networked facilities.

In Case of a Cashless Claim:

In the cashless claim settlement process, the insurance company directly resolves the amount with the hospital, offering a seamless experience for the policyholder. A notable advantage for the policyholder is the absence of any out-of-pocket expenses, except for a deductible if applicable. Furthermore, as the claim is settled directly, there is no need for the policyholder to manage hospital bills and subsequent reimbursement.

To initiate a cashless claim settlement, the policyholder has the option to visit any of the insurance company's network hospitals and provide their health insurance policy details. Most hospitals have dedicated departments or desks for insurance claim settlements, where the policyholder can present either the physical copy of the policy or an e-card issued by the insurance company. Opting for a cashless claim settlement necessitates providing proof of the policy.

The hospital verifies the policy details and submits the pre-authorisation form to the insurer. The insurance company authenticates the policy details and processes the claim settlement in accordance with the policy's terms and conditions. The claim is settled directly between the hospital and the insurance company.

In instances where the policyholder is aware of upcoming surgery or medical treatment, pre-planning is essential. The policyholder must inform the insurer in advance about the treatment and the chosen network hospital.

You can inform the insurance company by:

- Placing a call to their toll-free or customer service number

- Sending an email to customer service

- Mailing a letter to the registered address of the insurance company

Additionally, the policyholder needs to submit a duly filled cashless settlement form from the hospital to the insurance provider, and this can be sent through email, fax, or post.

Once the policyholder completes their part, the insurance company coordinates with the hospital and notifies the policyholder upon claim acceptance. At the time of hospital admission, the policyholder is required to present the policy or e-card.

In Case of an Emergency Claim:

In case of an unforeseen medical emergency, the policyholder or their family members should promptly inform the insurance company by calling the toll-free number. While it may be challenging for family members to notify the insurer beforehand, immediate notification post-hospitalisation is crucial. Moreover, family members must ensure the timely completion of a cashless claim settlement form by the hospital, submitted to the insurer within 24 hours of hospitalisation.

What Are the Factors to Consider Before Choosing a Cashless Health Insurance Policy for Your Family?

1. Sum Insured Coverage:

The sum insured coverage of the cashless health insurance policy should be sufficient to cover you and your family during medical emergencies.

2. Network Hospital List:

Before choosing a cashless health insurance policy, always review the list of network hospitals affiliated with the insurance company. Choosing an insurer that has network hospitals in close proximity to your locality ensures easy access to cashless treatment during medical emergencies.

3. Co-payment and Sub-limits:

Pay attention to co-payment percentages and sub-limit clauses. Co-payment represents the percentage of the claim that the policyholder bears, which is not covered by the insurance company.

4. Pre-existing Illnesses Waiting Period:

It is crucial to be aware that cashless facilities for pre-existing illnesses or treatment are only applicable once the waiting period for pre-existing illnesses is completed. Hence, it is advisable to opt for a policy with the shortest waiting period.

5. List of Exclusions:

Exclusions are the medical treatments and situations that the insurers do not cover. Before opting for a health plan, you should check the list of exclusions considering your family's health history.

6. Daycare Procedures:

Cashless health insurance policies cover a variety of day care procedures. When choosing a plan, you should prioritise those offering a broad range of daycare treatments.

To conclude:

Buying a health insurance plan is crucial, especially when purchasing coverage for your family. When selecting the right plan, you must exercise caution. The biggest advantage of a cashless health insurance policy is that it eliminates the need for immediate cash arrangements during a medical emergency.

Given that health insurance plans are portable, meaning they can be transferred to any insurance company during renewal, you don't have to wait for the perfect match. You can always choose a different insurer if you are unsatisfied with the existing one. However, the crucial step is to buy a health insurance plan without any delays.

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KETKI JADHAV is a Content Writer at PersonalFN since August 2021. She is an MBA (Finance) and has over seven years of experience in Retail Banking. Ketki specialises in covering articles around banking, insurance, personal finance, and mutual funds and has been doing it for over three years now.

Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing.
This article is for information purposes only and is not meant to influence your investment decisions. It should not be treated as a mutual fund recommendation or advice to make an investment decision in the above-mentioned schemes.