Cashless claim

What is a cashless claim? 

A cashless claim is a type of health insurance claim that allows a policyholder to receive medical treatment at a network hospital without paying the hospital bill upfront. Instead of the patient paying first and seeking reimbursement later, the insurer directly settles the bill with the hospital. This helps individuals get timely treatment without worrying about arranging money during a medical emergency or planned hospitalization.

How does a cashless claim work?

A cashless claim works when the policyholder gets medical treatment at a network hospital, a hospital that is part of the insurance company’s approved list. At the time of admission, the hospital verifies the patient’s health insurance coverage and sends the necessary details to the insurer or the Third-Party Administrator (TPA).

The insurer or TPA then reviews the policy terms, treatment details, and coverage limits. If everything is valid and covered under the policy, they give authorization for cashless treatment. After the treatment is completed, the insurer directly settles the approved medical expenses with the hospital. The policyholder only needs to pay for non-covered items, if any.

What is pre-authorization?

Pre-authorization is the process where the hospital sends the patient’s medical details and treatment plan to the insurer or TPA to request approval for cashless treatment. It confirms whether the treatment is covered and how much the insurer will pay. Cashless treatment begins only after this approval.

What is planned hospitalization?

Planned hospitalization is when a patient is admitted to a hospital for a treatment or surgery that is scheduled in advance. Examples include knee replacement surgery, eye surgery, or childbirth through a planned C-section. In such cases, the patient can start the cashless claim process in advance, submit documents, and get pre-authorization before admission.

What is emergency hospitalization?

Emergency hospitalization happens when a patient is admitted without any prior planning due to sudden and urgent medical conditions. Examples include heart attacks, accidents, severe injuries, or sudden breathing issues. In these cases, the hospital or family must inform the insurer or TPA within 24 hours to request cashless approval.

How do you file a cashless claim?

Planned hospitalization

1. The policyholder selects an insurer-approved network hospital for treatment.
2. They provide policy details or show their health card /e-card at the hospital desk.
3. The hospital submits a pre-authorization form with medical details to the insurer or TPA.
4. The insurer reviews the request and gives approval for cashless treatment.
5. The patient receives treatment, and during discharge, the insurer settles the approved bill directly with the hospital.

 Emergency hospitalization

1. The patient is admitted immediately for urgent medical care.
2. The hospital or a family member must inform the insurer or TPA within 24 hours.
3. The insurer reviews and processes the cashless request on priority, and if approved, the treatment cost is covered as per policy terms.

What is cashless claim settlement time?

For planned hospitalizations, insurers usually take a few hours to approve a cashless request. For emergency cases, the approval process is faster and may be completed within a shorter timeframe. However, the settlement time may vary based on factors such as treatment type, documentation accuracy, and policy coverage.

Want to learn more health insurance terms? Check our Insurance Glossary.

Which documents are required for a cashless claim?

To process a cashless claim smoothly, the patient or hospital must submit the following documents:

• Health insurance card 
• Valid KYC documents (such as ID proof, address proof)
• Doctor’s reports, prescriptions, and diagnostic test results
• Final hospital bills and the discharge summary

Eligibility conditions

A cashless claim is approved only when certain conditions are met:

• The treatment must take place at a network hospital.
• The medical condition and treatment must be covered under the insurance policy.
• The policy must be active, and any waiting period related to the illness should be completed.

Common reasons for claim rejection

A cashless claim may be rejected if:

• The treatment is not covered under the policy.
• The policy has expired or lapsed.
• Required documents are missing or incorrect.
• The hospital is not part of the insurer’s network or blacklisted.

Benefits of cashless claim for employees

A cashless claim offers several advantages, especially for working professionals:

• Immediate medical help without financial stress.
• Less paperwork compared to reimbursement claims.
• Extremely useful during medical emergencies when arranging funds may be difficult.

Why HR teams should know this

HR teams play an important role in supporting employees during medical situations. Understanding cashless claims helps HR professionals:

• Guide employees during hospitalization and claim submission.
• Coordinate with insurers or TPAs for a smooth experience.
• Strengthen employee wellbeing and build trust in workplace health benefits.