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09 March, 2008

When 38-year-old Santosh Balan, a senior private sector executive, was faced with a medical emergency concerning his wife, settling the hospital bill was the least of his concerns he had the necessary medical cover. But an overlooked lapse in procedure almost cost him a tidy sum. At the time of discharge, the third party administrator (TPA) had not processed the claim or intimated the expense limit to the hospitala standard procedure for those who opt for a cashless health cover, recalls Balan. As a result, Balan had to extend his wife's hospital stay by a day to enable the TPA to process and settle the claim with the hospital. Cashless health insurance is a boon in times of medical emergencies. The key to an effortless claim settlement is the TPA appointed by the insurer to see your claims and accelerate processing hospital bills. Outsourcing the claims processing function to TPAs can create problems if there's poor liaison between TPAs and hospitals. For the customer, a TPA is a non-entity as he bought the policy from the insurance company, says Shreeraj Deshpande, Head (Travel and Health Insurance), Bajaj Allianz. Cashless policies allow customers to get medical treatment without paying cash upfront to the hospital or pay hefty bills at the time of discharge. "That can be a load off one's back, especially in times of emergencies when the entire focus is on the patients life", says Ritesh Kumar, Head (Retail), ICICI Lombard General Insurance. However, as both Deshpande and Kumar admit, its a facility and comes with its own set of conditions.
Whats not covered
While most illnesses are covered under cashless policies, it is important to know the exclusions. Says Ajay Bimbhet, MD, Royal Sundaram Alliance Insurance:Exclusions include pre-existing diseases, heart, kidney and circulatory disorders in respect of insured persons suffering from pre-existing hypertension or diabetes and it is up to the TPA to determine whether a particular illness can be covered under the scheme or not.
The anatomy of cashless insurance
What the fine print does not tell you, and what it does. - Cashless facilities are available only at approved or network hospitals of the insurance company. At others, you can claim reimbursement after settling the hospital bills

  • Certain illnesses/diseases may not be covered either by the insurer or under your policy
  • Certain illnesses/diseases may be covered only after the first year of insurance
  • Existing illnesses/diseases are usually not covered by the policy
  • Risk of delayed response by TPA, especially if the insurer has outsourced the function. A TPA usually handles several insurers, and so, may not be able to give individual attention to each case
  • Problems like delays in either starting treatment or discharge may arise if there is poor liaison between TPA and hospital
  • You have to be hospitalised for a minimum of 24 hours to avail of this facility unless it's a highly specialised surgery like cataract in which case the 24-hour condition is waived.