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Cashless settlement just 32% of overall claims in health insurance, says new report

Despite two decades of health insurance in the country, most policyholders need to file reimbursement claims. Cashless claims continue to be a small proportion.

Around 68% of the claims are reimbursement claims and only 32% are cashless, according to a report titled India Health Insurance XP Survey – 2020 by Beshak, a research platform for insurance users.

One straightforward reason for higher claims through reimbursement is that the policyholder didn’t go to a hospital which is part of the insurer network. “But there are other problems too. Some opt for reimbursement if the third-party administrators (TPA) take time to provide cashless facilities in network hospitals,” said Mahavir Chopra, founder of Beshak.

The report is compiled based on an online and telephonic survey of 530 individuals. Of these, 42% had group insurance and 58% had personal policy. A majority (53%) had policies from public sector insurers and the remaining (47%) from private companies.

According to Chopra, a cashless facility is smoother for employer-provided insurance compared to a personal policy. That’s because insurers and TPA have better systems in place for corporate clients. Over half (52%) respondents said that they have faced problems in getting timely support from insurers or their TPAs.

Half of the respondents got guidance from insurers or TPAs. But the other half had to repeatedly follow up during the claim settlement process.

A few even had to face tough times due to inefficient processes of hospitals and insurers. One of the respondents had to wait until 5PM to
get the claim settled even though the doctor gave a discharge in the morning.

The report found that such incidents are not one-off. Around 19% respondents had to wait 24 hours to get their claims settled when they opted for cashless and 46% had to wait for 7-24 hours.
Of those who opted for reimbursement claims, 29% had to wait for over eight weeks for the settlement and 33% had to wait for 4-8 weeks.
According to Chopra, a lot of this could be fixed if insurers and hospitals invest in technology. He gave a comparison of the food delivery. “Now when you order from a restaurant, you can track the order real time. Earlier, it was not the case. Insurers, too, need to put real time tracking systems for claims to make the process smoother.”

Until insurers and hospitals better their existing processes, there are bound to be delays and customers may choose to opt for reimbursement claims instead of waiting to hear from the hospital’s billing desk that their claims are settled.