Health insurance plans have two types of claim settlement process: cashless and reimbursement.
What is a cashless claim?
Any policy holder can get medical treatment i.e planned and emergency hospitalization at a hospital listed in network by the insurer/TPA without having to pay. Cashless request also can be initiated prior to admission date in advance.
What is a reimbursement claim?
In a reimbursement claim, the insured has to pay all his/ her medical bills and other costs involved in hospitalization and treatment and then claim for reimbursement from the insurer. In order to avail reimbursement claim you have to provide the necessary documents including original bills to the insurance provider.
Advantage and Disadvantage of cashless claim settlement
No Need of Emergency Cash – Cashless policies spare you from the need to run around gathering money during a financial emergency. A cashless policy helps you avoid the stress of having to ask somebody else for financial help. The claim is settled instantly.
Hospital must remain in Insurer’s Network – You have to seek hospitalization only in a network hospital to avail cashless benefit. If the insured chooses to receive treatment elsewhere, then the cashless facility will not work. The insured will then have to go the reimbursement route only.
Advantage and Disadvantage of reimbursement claim settlement
Insured can get the treatment in any hospital as per their choice and later get the bills settled.
Insured must have to face financial strain of any hospitalization. Reimbursement can be processed only when patient is discharged from the hospital and the treatment is complete. A lot of bills, other supporting documents and reports are required to be submitted to the insurance company for availing reimbursement of your claim. Reimbursement claims take time.
Every Insurance company has the provision to take claims either way. They understand the benefits of a cashless claim settlement and want their customers to have a hassle-free claim settlement process, at the same time they do not want to strip the insured from the option of getting treatment at a hospital of their choosing and reimburse the expenses. The choice is completely upto the insured which option they want to choose.