Medical costs are not the only expenses a person incurs during hospitalisation. One must consider the costs of consumables, personal items, or even providing for dependent family members, which becomes more challenging if the patient is the only earning member. Even if health insurance does not cover these aspects, it can no longer put a policyholder in a quandary. Most plans now have hospital daily cash that can allow you to meet fringe expenses and compensate for the loss of income during a hospital stay or treatment. Here's a lowdown on what it entails, its benefits, how you can procure it, exclusions and other important aspects.
Hospital Daily Cash Meaning
A hospital daily cash plan is one of the types of health insurance plans that offers a set sum for each day of your hospital stay. The amount is predetermined at the time of the policy's issuance and remains unchanged. One can view this as a defined benefit plan as it pays a fixed sum regardless of the actual expenses. For instance, when you buy health insurance and choose a plan with a daily cash allowance of INR 1,000, the insurer will pay you this amount for each day you stay in the hospital, even if your actual medical expenses are INR 500 or INR 1,100 a day.
The Plan's Scope of Coverage
Even though health insurance plans cover most of the medical bills, there are some costs they skip — these are called inadmissible expenses and include costs for accompanying family members, X-ray fees, surgery supplies and more. The allowance you select under a daily hospital cash plan determines the coverage and ranges between INR 500 to INR 3,000 a day. Since the expenses in an ICU are higher, this allowance usually doubles or even quadruples, depending on the policy. For instance, if the daily hospital cash under your policy is INR 2,000 in a general ward, it may increase to INR 4,000 if you are admitted to an ICU. Some policies also provide a lump sum if the insured needs to undergo surgery.
The daily hospital payment allocation may occasionally be described as a proportion of the insured amount. For instance, if your health insurance policy provides a daily hospital cash benefit of 1% of the total sum insured, which is INR 3 lakhs, the daily cash benefit you would receive in the case of your hospitalisation would be INR 3,000.
Automatic Availability
In most cases, the daily hospital cash insurance begins without submitting any supporting documents. Only a legitimate hospitalisation lasting at least 24 to 48 hours qualifies as proof for this benefit. However, the insurer will refuse the benefit if the hospitalisation is later determined to be ineligible. Inform the provider beforehand in case of a pre-planned hospitalisation, and as soon as possible in case of an emergency.
Daily Cash Plans Tenure
A daily hospital cash policy benefit typically lasts between 15 to 45 days. However, the precise number of days may differ from one health insurance company to another. During the policy period, you can also receive hospital cash benefits if you are hospitalised for 10 days. You must check this when buying a policy.
Expenses it Can Cover
You can utilise the daily hospital cash to cover any additional expenses you may have during your hospital stay in addition to the hospital bills. These may consist of:
- Consumables such as syringes, masks and gloves
- Personal items such as toiletry or hygiene products
- Travel costs to and from the hospital
- Employing a personal attendant
- Family's living costs until you are unable to work
Benefits to the Policy Itself
Yes. Benefits include coverage over and above the insured amount. The daily cash allowance may cover the difference if the hospital bills exceed the sum insured. It also helps you maintain your no-claim bonus (NCB); that is, if the hospital bills are not too steep during hospitalisation for a minor injury or ailment, you need not claim your insurance and pay from the daily cash allowance, thereby preserving your NCB. However, do ascertain this with your insurer beforehand.
Procedure for Hospital Daily Cash Claims
Procedures are different for cashless and reimbursement claims.
- Cashless Claims
If you have a cashless health insurance policy, present your health card and/or policy paperwork at the time of admittance, and the insurer will authorise your daily cash plan. When you are being discharged, you may only need to pay the deductible of one day of hospitalisation; the hospital and insurance provider will settle the balance.
- Reimbursement Claims
The procedure begins when you are discharged from the hospital. Submit the claim form and the necessary documentation to the insurer. The claim amount will be released after the documents have been verified.
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Exclusions in Hospital Daily Cash Plans
There are some instances in which the hospital daily cash benefit is not applicable, such as if the treatment results from:
- Pre-existing disease
- Hospitalisation during the waiting period
- Outside India, unless stated otherwise in the policy document
- Out-patient department (OPD) expenses
- War perils, nuclear reaction, terrorism, self-inflicted injury and so on.
Hospital Daily Cash Plan Renewal
Most separate hospital cash benefit plans offer lifetime renewability with a grace period of 30 days. During this time, the policy may be renewed if it was not done within the first specified time frame.
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