Health insurance is essential for managing medical expenses in India. While cashless claims are popular, many policyholders opt for reimbursement claims, especially when treatment is taken at a non-network hospital. In a reimbursement claim, the policyholder pays the hospital bills upfront and later gets the amount reimbursed by the insurer.
Filing a reimbursement claim requires proper documentation, adherence to timelines, and compliance with policy terms. Many claims are delayed or rejected due to missing paperwork, policy exclusions, or incorrect submissions. Understanding the process, required documents, and potential pitfalls can help ensure a smooth claim settlement.
This guide provides a detailed overview of how reimbursement claims work, the step-by-step process, required documents, and tips to avoid rejection. It also compares cashless vs reimbursement claims, helping policyholders make informed decisions when choosing a health insurance plan.
Reimbursement claim meaning
A reimbursement claim is a formal request made by a policyholder to their health insurance provider to recover out-of-pocket medical expenses they have paid.
For example, Mr. Gupta recently had surgery at a hospital outside his insurer’s network because he trusted the surgeon there. Since this hospital wasn’t covered by his plan, he needed to claim reimbursement.
After the surgery, Mr. Gupta received a detailed bill listing charges like the doctor’s fees, operating room costs, and medication expenses. Instead of paying these directly, he submitted a reimbursement claim to his insurer.
He gathered all required documents, such as medical bills, prescriptions, and a letter from the surgeon explaining why the specific hospital was necessary. He then filled out the claim form with his personal and policy details, along with a clear expense breakdown.
The insurance company reviewed his claim, confirmed his policy coverage, and verified the authenticity of the expenses. Once approved, they processed the claim, and Mr. Gupta was reimbursed for the eligible costs.
Types of reimbursement in insurance claim?
Here are two types of cashless claims explained:
Cashless claim
In a cashless claim, policyholders receive medical treatment at a hospital or healthcare facility that is part of their insurer’s approved network. After obtaining any required pre-authorization, the hospital directly bills the insurance company for the covered medical expenses.
Policyholders usually don’t have to pay upfront for these expenses, except for co-payments, deductibles, or any costs not covered by the policy. This method offers convenience for both planned procedures and emergencies, reducing immediate financial pressure on the insured.
Reimbursement claim
In a reimbursement claim, policyholders can get treatment at any hospital—whether in-network or not. They pay the medical bills themselves first and then collect all relevant documents such as bills, receipts, and medical records.
These documents, along with the claim forms, are submitted to the insurer for review. The insurance company verifies the claim according to the policy terms and, once approved, reimburses the policyholder either partially or fully. Unlike cashless claims, the initial medical payments are made out-of-pocket and refunded after claim approval.
What are the benefits of reimbursement claim in medical billing
A reimbursement claim offers several advantages that can enhance your health insurance experience. Here are some key benefits:
- Freedom to choose healthcare providers
You can opt for any healthcare facility you prefer without being limited to cashless network hospitals, allowing you to make the most of your insurance coverage. - No restrictions on location
There’s no need to worry about finding a network hospital nearby. Reimbursement claims let you receive treatment at any hospital, giving you greater access to quality care wherever you are. - Immediate access to treatment
You can begin your medical care right away without waiting for insurance approvals or completing extra paperwork, ensuring prompt attention when it matters most. - Simplified claim process
You can file your reimbursement claim after completing treatment and paying your bills, making the process straightforward and reducing unnecessary delays for a smoother experience.
How does a reimbursement claim work in health insurance
A reimbursement claim allows policyholders to claim back medical expenses incurred at hospitals that are not part of the insurer’s network hospitals. Unlike cashless claims, where the insurer directly settles bills with the hospital, here, the policyholder pays first and then submits a claim for repayment.
Process of a reimbursement claim
- Hospitalisation and payment – The insured undergoes treatment and settles all hospital bills.
- Collect necessary documents – All original invoices, prescriptions, and reports must be collected.
- Claim submission – The insured submits a claim form along with supporting documents to the insurer.
- Insurer review – The insurer verifies the claim to check compliance with the policy.
- Approval and payment – Once approved, the amount is reimbursed as per the policy terms.
Key points to remember
- Claims must be filed within the stipulated time mentioned in the policy.
- Non-admissible expenses such as personal items, non-medical costs, or policy exclusions will not be reimbursed.
- The reimbursement process may take 7-30 days, depending on the insurer’s claim approval procedure.
