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Cashless vs. Reimbursement Hospitalization in Health Insurance

Published On Dec 29, 2020 5:30 AM By Gunjan Anand

Medical insurance has become extremely important to deal with treatment costs and hospitalization bills. Most people opt to pay for their hospital bills through their health insurance policies. There are two types of claims settlement in health insurance, namely cashless settlement and reimbursement settlement. In the cashless settlement, the insurance company will bear the bills at the time of discharge. In the reimbursement clause, the bills are borne by the individual, and can later be claimed from the insurer.

Cashless vs. Reimbursement Hospitalization in Health Insurance

Cashless Vs Reimbursement Hospitalization

Parameter Cashless Hospitalization Reimbursement Hospitalisation
Claims The insurance providers settle the hospital bill and should be informed about the hospitalization in advance. The policyholder pays the bill upon discharge and claims reimbursement.
Individual liability The individual need not pay any medical bill by self and the insurance company will settle the bills with the hospital directly. The insured has to bear the medical costs initially and have to submit the bills with the insurance company for claims settlement.
Hospital network Treatment should be taken only within the hospital network suggested by the insurance company. Treatment can be taken in any hospital.
Speed of claims settlement The claims will be settled instantly when the insured is taking treatment in the hospital. Reimbursing the treatment bills will take time.

Process of Claim Settlement: Cashless v/s Reimbursement Claim

The process of settlement in both types of insurance is different. In a cashless claim process,

  • The individual has to inform the insurance company in advance in case of a planned hospitalization.
  • Even in emergencies the insurance company or their third-party agents should be informed soon after admission.
  • It is required to fill a pre-authorization form to get approval for the treatment and to aid the company settle the bills directly.

The bill settlement in the reimbursement claim is as follows,

  • People will meet their expenses during the treatment and it is important to collect every single bill for the treatment.
  • The discharge summary is a must to avail reimbursement and this summary along with the hospital bills should be submitted with the insurance company.
  • The insurer will scrutinize the bills thoroughly before reimbursing the claim.

Which is Better: Cashless or Reimbursement Claim?

When we compare the two forms of health insurance schemes available, the cashless claims settlement is the best as it spares the insured from financial burdens. Even at times of emergencies, they can take treatment without any hesitation and without having to worry about money.

Whereas in the reimbursement process, it is important to have money at hand to pay the hospital bills at the time of discharge. But during emergencies, we can get admitted to any hospital and avail of the reimbursement, which is not the case with the cashless claim.

Final Words

Overall, the cashless claim process is better than the reimbursement claims, mainly because it is extremely convenient. It is much preferred as there is no need to pay the hospital expenses from one’s pocket. Most insurance companies will have a wide range of hospitals included in their cover and thus there is no panic to search for partner hospitals during emergencies.

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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