Overview
Health insurance claim settlement can be done in two ways—cashless and reimbursement. Both serve the same purpose of covering your medical expenses, but the process and convenience differ:
✅ Cashless Claim Settlement
- In this method, the insurer directly settles the hospital bill with the network hospital.
- The insured doesn’t need to pay upfront (except for non-covered items).
- Requires pre-authorization (for planned hospitalization) or intimation within 24 hours (for emergency cases).
- Best suited for planned treatments in empanelled hospitals.
✅ Reimbursement Claim Settlement
- The policyholder first pays all medical expenses out-of-pocket.
- Later, they submit all original documents, including bills and discharge summaries, for claim processing.
- Ideal when treatment is taken at non-network hospitals or in urgent cases without pre-authorization.
📊 Key Differences at a Glance:
| Criteria | Cashless Claim | Reimbursement Claim |
| Hospital type | Only network hospitals | Any hospital |
| Payment responsibility | Insurer (direct to hospital) | Insured initially |
| Paperwork | Minimal (mostly at hospital TPA desk) | Extensive (submission of all bills) |
| Processing time | Instant or during discharge | Usually 7–15 working days |
Health insurance plans have two types of claim settlement processes: cashless and reimbursement.
What is a cashless claim?
Any policyholder can get medical treatment i.e planned and emergency hospitalization at a hospital listed in the network by the insurer/TPA without having to pay. The cashless request also can be initiated prior to the admission date in advance.
What is a reimbursement claim?
In a reimbursement claim, the insured has to pay all his/ her medical bills and other costs involved in hospitalization and treatment and then claim for reimbursement from the insurer. In order to, avail reimbursement claim, you have to provide the necessary documents including original bills to the insurance provider.
Advantages and Disadvantages of cashless claim settlement
Advantages
No Need for Emergency Cash – Cashless policies spare you from the need to run around gathering money during a financial emergency. A cashless policy helps you avoid the stress of having to ask somebody else for financial help. The claim was settled instantly.
Disadvantages
The hospital must remain in Insurer’s Network – You have to seek hospitalization only in a network hospital to avail of the cashless benefit. If the insured chooses to receive treatment elsewhere, then the cashless facility will not work. The insured will then have to go the reimbursement route only.
Advantages and Disadvantages of reimbursement claim settlement
Advantages
Insured can get treatment in any hospital as per their choice and later can settle the bills.
Disadvantages
Insured must have to face the financial strain of any hospitalization. Can process Reimbursement only when discharged the patient is from the hospital and the treatment is complete. A lot of bills, other supporting documents, and reports requires to submit to the Health insurance company for availing reimbursement of your claim. Reimbursement claims take time.
Every Insurance company has the provision to take claims either way. They understand the benefits of a cashless claim settlement and want their customers to have a hassle-free claim settlement process, at the same time they do not want to strip the insured from the option of getting treatment at a hospital of their choosing and reimburse the expenses. Therefore, the choice is completely up to the insured which option they want to choose.
FAQs
Q) What is the difference between cashless and reimbursement claim?
A) In a cashless claim, the insurer directly pays the hospital, while in a reimbursement claim, the policyholder pays first and gets reimbursed later.
Q) Which is better: cashless or reimbursement?
A) Cashless is more convenient and faster, especially for planned treatments at network hospitals. Reimbursement works when the hospital is not empanelled or during emergencies.
Q) Can I get cashless treatment in any hospital?
A) No, cashless facility is only available at insurer’s network hospitals. You can check the list on the insurer’s website or TPA portal.
Q) What documents are required for reimbursement claim?
A) You need:
- Original bills and payment receipts
- Doctor’s prescription
- Discharge summary
- Investigation reports
- Policy copy and ID proof
Q) Is pre-authorization required for reimbursement?
A) Pre-authorization is not mandatory for reimbursement. But in case of planned hospitalization, informing the insurer in advance may help in faster processing.
Q) How long does it take to settle a reimbursement claim?
A) Most insurance companies settle reimbursement claims within 7 to 15 business days, provided all documents are correct and complete.
About The Author
Pooja
MBA Insurance Management
Pooja is a dedicated professional with 7 years of experience in the insurance industry, specializing in Family Health Insurance. Writing for SecureNow, she offers insightful blogs and articles aimed at simplifying the complexities of health insurance for families. Her expertise ensures that readers gain practical, easy-to-understand advice on choosing the best coverage to protect their loved ones. Committed to making informed decisions accessible, Pooja stays updated on industry trends and developments, providing valuable content that empowers families to secure their health and financial well-being.
