Cashless vs Reimbursement Claims – What's Better?

Purchasing health insurance has become a necessity, especially with the news of the double-digit medical inflation being a topic in nearly every discussion. With the introduction of digital platforms, buying a policy has become easier than ever. However, one aspect that remains unclear is how to maximise the benefits of your health insurance. While this may appear overwhelming at first, taking one step at a time and starting with the claim settlement can help ease the decision-making process.

Typically, most health insurance providers offer two types of claim settlement procedures: cashless and reimbursement. Let’s understand the differences between the two and how to choose the right kind of claim settlement for your insurance plan.

What is Claim Settlement?

Claim settlement is the process by which an insurance company delivers the promises it made under the plan. In any case, if the insured wishes to obtain a service that is covered under the insurance plan, they can submit a claim to the insurance company, and the latter will then ensure that the claim is processed and settled. Depending on the policy, the insurance company either provides a cashless claim settlement or reimburses the insured.

What is Cashless Claim Settlement?

A cashless claim settlement is a type of claim settlement where the insurance company covers all expenses, up to the sum insured or the coverage limit, to reimburse the insured for the cost of services provided. Under a cashless claim settlement, the policyholder does not have to pay for the medical expenses out of their pocket. The bills are settled between the hospital and the insurance company. The policyholder only pays the uncovered expenses, if any.

What is Reimbursement?

Reimbursement is a type of claim settlement where the policyholder pays the medical bills upfront and out of pocket for the services received under the policy, and then submits the bill to the insurance company for settlement or reimbursement. The insurance company verifies the claim and reimburses the policyholder accordingly.

Cashless Claim Settlement Vs Reimbursement: What You Should Know

Choosing between cashless claim settlement and reimbursement can appear confusing, but once you understand the key features, you will be in a better place to decide.

Features	Cashless Claim Settlement	Reimbursement Claim
Meaning	A type of claim settlement where the medical bills are settled directly by the insurance company.	A type of claim settlement where the policyholder pays the medical bills, and the insurance company later reimburses them.
Settlement Process	The policyholder must submit their policy documents and health insurance cards before treatment to have the bills settled. Note: The process might vary depending on the insurance company and hospital.	The policyholder must submit the bills, along with the policy documents, to the insurance company once the patient is discharged. The insurance company verifies and reimburses the amount.
Benefits	The policyholder is not required to pay upfront for medical services (only the uncovered expenses). The claim settlement process is usually fast and customer-friendly.	The policyholder can get medical services even at a non-network hospital and later get reimbursed for the expenses.

Choosing the Right Claim Settlement Process

Let’s take a look at some of the reasons under which you can choose either of the claim settlement processes:

Cashless Claim Settlement

Quick and Easy

Usually, a cashless claim settlement is advised for a quick and easy hospitalisation without worrying about the medical bills, as long as you are getting medical services that are covered under the policy and up to the SI limit.

Did You Know that IRDAI has mandated that every health insurance company settle cashless claims under cashless health insurance within three hours of receiving the discharge documents?1

Treatment at Network Hospital

If you are getting a treatment covered under your policy at any of the hospital networks, a cashless claim settlement is a smart choice.

Did You Know that IRDAI has introduced the “Cashless Everywhere” facility to ensure a cashless claim settlement even at non-network hospitals?2

Reimbursement

Medical Emergency

In any case, when the insured's needs arise from a medical emergency and the insured has failed to obtain pre-approval from the insurance provider, a reimbursement claim settlement is a suitable option.

Unavailability of Cashless Facility

If a cashless facility is not available at the chosen hospital, then you can opt for reimbursement claim settlement.

Claim Rejection

If, for any reason, your claim has been delayed or temporarily rejected by the insurance company, you can still pursue reimbursement and settle the bills later.

Over to You

Choosing between cashless claim settlement and reimbursement claim can seem overwhelming, but once you have understood the features and benefits, you can easily make a decision. A cashless claim settlement ensures that instead of worrying about medical bills, you are focused on getting healthier, whereas reimbursement claim settlement is a reliable choice for medical emergencies or medical treatments at non-network hospitals. If you are covered under a family floater plan, you can avail these benefits for your entire family.

If you haven’t yet purchased medical insurance, this is your sign to choose one that best meets your needs.

Over to You

Care Health Supreme and HDFC ERGO Optima Restore are among the best health insurance policies in India today. It is a matter of your priority, coverage depth over cost effectiveness. Here’s a quick recap for you to make an informed decision.

Both offer coverage of up to ₹1 crore; Optima Restore starts at ₹3L, Care Supreme at ₹7L. Supreme offers unlimited recharge; Optima Restore offers 100% once a year, after a claim is made. Care includes OPD + unlimited e-consults; Optima lacks OPD, allows one consultation/year. Care gives a 30% discount + 500% bonus; Optima offers 8% discount + 50% bonus. Care Supreme is costlier but has more features. Optima suits budget buyers; Care fits those needing wider, long-term coverage.

Whichever health insurance plan you choose, ensure to read the policy wordings and seek advice from an expert before you make the purchase. The best health insurance is the one that covers you the way you want to be covered.

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Author Bio

Paybima Team

Paybima is an Indian insurance aggregator on a mission to make insurance simple for people. Paybima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. Paybima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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