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COVID-19 has changed our world, every single person, young or old has been affected by this deadly disease in some way or the other. There has also been a major change in the mindset of people towards health insurance, especially in India.

Recently, Max Bupa conducted an online survey where it was discovered that 70% of the entire population now considered health insurance to be a necessary shield against the pandemic. The figures were limited to a mere 10% before the outbreak of COVID-19.

While many people are investing in health insurance policies, there are still many who aren’t very well-versed with how health insurance really works. Most people are concerned about the claim that has to be made at the crucial time of hospitalisation. 

Getting the claim benefits when you need them the most, is the core aim of buying health insurance. In order to get the claim processed one needs to understand how health insurance claims work. In this article, we are going to discuss health insurance claims, the types, and how to file a claim.

Health Insurance Claims 

When you buy a health insurance plan the aim is to seek financial support that can cover the expenses that you have incurred during treatment. A claim is an official request that helps you receive healthcare, the costs of which are borne by your insurance company.

For example, your spouse, who is also covered under the health insurance plan, gets hospitalised. To make a claim you simply need to request a claim and the cost of treatment will be paid by the insurance company.

As per most health insurance plans, hospitalisation of 24 hours or more is essential to make a claim. There are certain plans that offer daycare facilities as well. You must ensure that you understand and follow all claim-related requirements so that a claim can be made and processed easily. Paying your premiums timely is also imperative else, your policy may lapse and your claim won’t be entertained.

Listed below are important points to remember when planning a health insurance claim:

  • All formalities must be understood and completed as per company rules and instructions
  • Claims have to be filed within 30 days of discharge
  • Consumables/non-payable items are not covered in health insurance claims
  • Keep all policy-related documents and other required paperwork handy, so that in case of an emergency you do not have to run around to complete them

Types of Health Insurance Claims

Primarily there are two types of claims that are admissible in a health insurance plan, these are cashless claim and reimbursement claim.

Both these types can be claimed when you have an indemnity based health insurance policy. However, if you have a fixed benefit health insurance plan, then your claim process will be different from these two. 

A. Fixed Benefit Plans Claim

In a fixed benefit health insurance plan, a predetermined sum insured is paid to the policyholder in case of hospitalisation. 100% of the amount is paid irrespective of the expenses that are incurred for the treatment is paid out to the policyholder. 

In most Fixed Benefit Plans the health insurance company would set-out their own conditions, approved by the IRDA, to be fulfilled to make a claim. Make sure you read and understand all the legalities before you finalise the purchase. 

B. Indemnity Claim for in-patient hospitalisation

When a health plan pays for the actual expenses of the claim, it is called an indemnity health insurance plan. For indemnity health insurance plans, there are 2 types of claims, namely cashless and reimbursement. 

For a better understanding of how health insurance claims work, it is first essential to understand the different kinds of hospitalisations. Both types of claims are applicable to both these types of claims.

  • Planned Hospitalisation
    As the name suggests a planned hospitalisation is when a treatment or a surgical procedure is carried out as per the doctor’s chalked-out plan, for example, a knee-replacement surgery would be a planned surgery. Your doctor will tell you in advance when and how the surgery would be conducted. 
  • Emergency Hospitalisation
    On the other hand, an emergency hospitalisation occurs in the form of an injury caused by an accident or other sudden medical issues like a heart attack.

I. Cashless Claims

A healthcare centre or a hospital that has a tie-up with your health insurance company to allow cashless treatment to the policyholders is called a network hospital. All the kinds of treatments and hospitalisations that are covered in your plan, will be paid for directly by your insurance company. This is called Cashless Claim, as the hospital bill is directly settled by the insurer and the hospital and the insured does not need to pay for the same.

When you purchase a health insurance plan there is a list of hospitals that fall under the health insurance company’s network. Only when you get admitted to a network hospital would you be eligible for a cashless claim. Cashless claims can be made for planned as well as emergency hospitalisation. 

Hospitalisations can be expensive, but a cashless claim facility saves you from running around raising money at the last minute. 

  • Advantages of Cashless Claim:
    • The easy and simple process of making a claim
    • No financial burden on you, as the health insurance company settles all bills and expenses
    • No hassle of paperwork

       
  • Disadvantages of Cashless Claim:
    • You can seek the treatment only in a network hospital, in case of an emergency that might be a problem
    • The process of discharge may be lengthy as all formalities are to be completed 

Cashless Health Insurance Claim Process

  • The first and most important step, when claiming cashless health insurance is informing the health insurance company. You must ensure that your claim request is registered as soon as possible, preferably before in case of planned hospitalisation.
  • After registering your claim, you need to fill in and submit a Pre-Authorisation/Claim Form to get the authorisation for a cashless treatment. This form may be taken from the hospital help-desk, or it can be downloaded from the TPA website. The form must be submitted in the hospital at least 3 to 4 days before the hospitalisation. 
    Even in case of an emergency, you must ensure that your claim request is registered within 24 hours of hospitalisation.
  • You can also ask the hospital for an estimated expenditure of the treatment that you are going to undergo. This would help you analyse if your health insurance has enough coverage to cover up the cost of treatment. 
    In case you have more than one health insurance plan, and the cover is not adequate in one, inform other insurance companies to use their claim.
  • Also see, if your policy has any sub-limits on rooms. You may opt for a shared-room if it fits in the policy.
  • Once you receive the approval from your health insurance company, only then the hospital would provide you with a cashless treatment. In case the approval gets delayed, the hospital may ask you to pay some amount as an advance. Once your request is sanctioned, the money will be refunded.
  • After the treatment is completed successfully, do not forget to ask the hospital for the bills and discharge summary to be sent to the health insurance company.
  • When you receive the final approval, the claim settled by the health insurance company would be clear. In case the consumables or other expenses are not covered by the insurer, you will have to pay them on your own. If you have any other policy that may cover these expenses, you can request for reimbursement. 
  • Even in a network hospital, pre and post hospitalisation charges are settled via reimbursement only. Thus, it is a good practise to get verified true copies of all your bills and discharge summary, so that you may wish to file the rest of the unpaid amount from another insurer at a later point of time.

For a Trouble-free Cashless Claim, Ensure:

  • It would be better that you arrive at the hospital before the patient to take care of the formalities
  • If you are the patient, a responsible friend/family member can help you with the formalities
  • Keep taking updates from the TPA or your health insurance for the first approval 
  • Check all bills and receipts thoroughly and take charge of all of them
  • If making Multiple Claims, remember to ask the hospital for certified True Copies of all Reports, Bills & Receipts, Investigative Reports, Doctors’ Prescription, Discharge Summary etc. Make sure all these are stamped and signed by the hospital

Documents Required to File a Cashless Health Insurance Claim 

The following documents are required when you make a health insurance claim, try and keep them together in a safe place. Your family members should also know about them, so that someday if you are hospitalised, they know where all the important documents are.

  • Health/Policy Card of the insured individual who is undergoing treatment
  • Policy Papers
  • Consultation papers by the doctor
  • Duly filled and signed Claim/Pre-Authorisation Form
  • Reports of investigative and diagnostic tests-CT scans, Ultrasound, X-rays, Blood Report etc.
  • In case of an accident, copy of FIR/Medico-Legal Certificate
  • Receipts and bills of medicines with Doctor’s Prescription
  • Discharge summary

II. Reimbursement Claims

As the name suggests, in reimbursement claims, you first clear the medical bills from your own pocket and later you can claim it from the health insurance company as a reimbursement. This type of claim occurs typically under two conditions:

  • Health insurance plans that do not allow cashless settlements 
  • When you get your treatment in a non-network hospital
  • Advantages of Reimbursement Claim
    • You can get your treatment at any hospital and get reimbursed later
    • A quick discharge is possible
    • You can get your pre-hospitalisation and post-hospitalisation claims together with your hospitalisation claim
  • Disadvantages of Reimbursement Claim
    • Initially, you are required to clear all the bills, so you would have to arrange money 
    • You will be reimbursed only once you are discharged
    • Lots of paperwork is involved

Reimbursement Claim Process

  • Just like in a cashless claim, the most important step, when claiming reimbursement is informing the health insurance company. You must ensure that your claim request is registered as soon as possible
  • In case of planned hospitalisation, make sure that you inform your health insurance company at least 3 to 4 days before the hospitalisation
  • In case of an emergency, you must ensure that your reimbursement request is registered within 24 hours of hospitalisation
  • You will have to pay for all the treatment costs from your pocket
  • Once you are ready for discharge, remember to take with you certified true copies of all the bills and receipts of all investigative tests, reports, discharge summary, etc. stamped and signed by the hospital
  • Once you are home, you can file for a reimbursement. If you are still under recovery, a responsible friend/family member can help you with the formalities
  • All the medical reports, doctors’ certificates, and bills are to be submitted to the insurance company
  • After assessing and verifying all the details, the claim will be reimbursed 

For a Trouble-free Reimbursement, Ensure:

  • From the time the treatment begins, prepare a file solely to list all the procedures and payments
  • Organise and number all the papers
  • Fill in the Claim Form carefully and correctly

Documents Required to File Reimbursement 

  • Policy Papers
  • Duly filled and signed Claim Form
  • Consultation papers by the doctor
  • Your account details for the transfer of the Reimbursement - keep a cancelled cheque ready for the same
  • KYC documents
  • Receipts and bills of medicines with Doctor’s Prescription
  • Reports of investigative and diagnostic tests-CT scans, Ultrasound, X-rays, Blood Report etc.
  • In case of an accident, copy of FIR/Medico-Legal Certificate
  • Discharge summary

III. Multiple Claims

In case you have invested in 2 health insurance policies, or a top-up or a super top-up policy, and if one policy alone is not adequate to cover the cost of treatment, you can request a claim for multiple claims. The combination can be 

  • Cashless + Cashless
  • Cashless + Reimbursement 
  • Reimbursement + Reimbursement

In the case of multiple claims, ensure that you inform the health insurance company/ companies in case 2 different plans are from 2 different companies. The procedure will be almost the same, just ensure that you fulfil all formalities correctly and timely. However, all you need to do is to obtain certified true copies of the first claim so that it can be submitted to the next insurer for a claim.

Why Your Health Insurance Claim May Get Rejected?

It is very important to understand all the steps to be followed for making a health insurance claim. Any discrepancy can result in the health insurance company rejecting the claim that you have made. Listed below are reasons due to which your claim may be denied-

  1. One of the most common reasons for a rejected claim is a claim request during the waiting period. There are certain predetermined diseases that are not covered during the waiting period. Different companies have different time durations as the waiting period.
  2. Whether intentional or unintentional, if the health insurance company finds that you have provided incorrect facts about your health conditions or you have hidden any important details, your claim will be denied.
  3. A claim made even a day after the policy expires will not be accepted. Most companies offer a Grace Period to renew the policy, but a claim made during this period also will not be entertained. 
  4. Not informing the health insurance company about the hospitalisation/treatment within the specified time limits, can lead to a claim rejection
  5. As a policyholder, if you do not go through all the exclusions of your health insurance plan, you might miss out on necessary information. This misinformation about exclusions can lead to a rejected claim. Read the company's list of exclusions carefully. Most typical exclusions are:
    • Injury under intoxication
    • Pre-existing illnesses
    • Self -inflicted injuries

Health Insurance Claims FAQs

  • 1. What is Co-pay? Does it affect the claim amount?

    When as a policyholder you need to bear a certain portion of the medical expenses, and the remaining is paid by your health insurance company, it is called co-pay. When you select a higher copayment amount, it means you pay a lower premium. The effect of co-pay on your claim will be decided by the kind of plan you choose. For example, if your clause says you pay 10%, then the insurance company would pay the remaining 90%.

  • 2. How to check my health insurance claims status?

    You can check the status by calling up the customer care of your health insurance company and inquire about the same. However, the easiest way to do so is doing it online. Visit the company website, go to ‘Claim/Claim Status’, enter your ‘Policy Number’ or the ‘Health Card Number and click on “Get Status”.

  • 3. What is the role of TPA in the health insurance claim settlement process?

    Introduced in 2001 by IRDA, TPA, Third-Party Association, is an organisation that works for corporate and retail health insurance plans and provides the claim benefits in a prompt, punctual and cost-effective smooth manner. Its responsibilities are:

    • Efficient delivery of services 
    • Standardisation of all claim-related process
    • Helping customers in understanding health insurance 
    • Avoiding fraud claims
    • Restricting unnecessary treatments
    • Reducing customer-confusion
  • 4. How does room rent affect health insurance claims amount?

    You must be mindful of the room rent to avoid any last-minute surprises at the time of claim. Most health insurance plans limit room rent between 1% to 2% of the sum insured. For example, if your sum insured is INR 5 lakhs, you will be eligible for a room that charges around INR 5,000 a day. If you opt for a room, which has rent higher than this, your insurance company will settle only a partial claim, you will have to pay the difference from your pocket.

  • 5. How does a sub-limit for a treatment affect the claim settlement process?

    Sub-limits mean that in case of medical treatment, the insurance company will bear only up to a certain limit and the remaining will be paid by you. It should be noted here, that sub-limits are not applied to the entire bill amount, but to certain specific conditions like room rent, ambulance charges etc. 

  • 6. What does Claim Settlement Ratio mean?

    Claim Settlement Ratio or the CSR means how many claims have been settled by the health insurance company as compared to the number of claims it received. A higher CSR means greater chances of claim settlement. 

  • 7. When can a health insurance claim get rejected?

    Listed below are reasons due to which your claim may be denied-

    1. There are certain predetermined diseases that are not covered during the waiting period. 
    2. Whether intentional or unintentional, if the health insurance finds that you have provided incorrect facts about your health conditions or you have hidden any important details, your claim will be denied.
    3. A claim made even a day after the policy expires will not be accepted. 
    4. Not informing the health insurance company about the hospitalisation/treatment within the specified time limits, can lead to a claim rejection
    5. Misinformation about exclusions can lead to a rejected claim. Read the company's list of exclusions carefully. Most typical exclusions are:
      • Injury under intoxication
      • Pre-existing illnesses
      • Self -inflicted injuries
  • 8. What is a planned hospitalisation?

    As the name suggests a planned hospitalisation is when a treatment or a surgical procedure is carried out as per the doctor’s chalked-out plan, for example, a knee-replacement surgery would be a planned surgery. Your doctor will tell you in advance when and how the surgery would be conducted. 

  • 9. Can I file a cashless health insurance claim during the grace period?

    No, once the policy has expired you can no longer make a claim. The grace period generally lasts for only 30-days during which you have to renew your policy. However, if you do not do that the policy lapses, despite the grace period, you will not be eligible to file any claim.

  • 10. Should I opt for Cashless Health Insurance?

    Cashless Health Insurance is considered to be more advantageous when compared to the Reimbursement, where first you pay the hospital bills and then you are reimbursed. Going to a network hospital is much more convenient as you get an instant treatment facility. You do not need to pay money out of your pocket. You can avail the best of treatments without worrying about managing funds. 
     

  • 11. How do I make a Critical Illness Claim?

    You need to inform your health insurance company at the earliest. Once you are diagnosed with any critical illness plan, you need to survive for a minimum of 30 days in order to initiate a claim. Thus, when you submit the necessary documents for a critical illness claim, along with the form, the entire sum assured would be paid to you in a lump sum and the policy would terminate.

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