Cashless or Reimbursement Health Policy

Buy a policy which suits your needs.

In a cashless health insurance policy it is exactly that - cashless. The policy holder makes no payment and the insurance company settles the bill. In a reimbursement plan the policy holder pays the bills and the insurer pays him when he files a claim.

With a cashless health policy the choice of hospitals is limited, as you have to be admitted to a hospital which comes under the insurer's network. When you choose a hospital within the network the bill will be settled directly. When a policy holder chooses a hospital outside the network he will first clear bills and claim later.

A reimbursement policy will allow you the choice of hospital and after you pay upfront the claims will be reimbursed.

A cashless policy is a real boon when a person is low on cash reserves, you can manage without emergency cash, as when you use a network hospital, the insurance company makes all the payments.

With a reimbursement plan you will need to pay first even if your funds are limited, and later file a claim and wait for the reimbursement.

In a cashless plan the policy holder will make use of the best hospital, with expensive rooms, since he need not pay. But the insurer can charge higher premiums from the policy holder. This is not the case with reimbursement plans as he will choose affordable care, since he will be making all payments, before he can claim from the insurer.

With a reimbursement plan, the policy holder has to retain all the bills, test reports and doctors bills. The claim will have to be first made and will be settled after a month. With a cashless card the insured can receive immediate treatment with it. The third party administrator (TPA) mediates to ensure a smooth claim settlement. Emergency cases are cleared within 6 hours and others within 4 days. The TPA can be informed earlier for pre-planned medical procedures.

References:

Hannah Punitha (IRDA Licence Number: 2710062)

Deepak Yohannan, March 2013

Source: Medindia