To handle the sudden loss of cashless facility, patients should maintain an emergency fund or a short-term credit line to manage all or part of hospitalisation costs.
Tata AIG General Insurance recently suspended cashless claims at Max hospitals in Delhi.
This is not an isolated event, but part of a wider pattern of disputes between private hospital chains and health insurers across the country.
"In recent months, Max Healthcare has faced high-profile cashless tie-up breakdowns with several insurers -- Star Health, Niva Bupa, Care Health, and most recently, Tata AIG. The suspensions, affecting hospitals nationwide and in the Delhi-National Capital Region, mirror a broader wave of stand-offs between major hospital chains and private insurers," says Shilpa Arora, co-founder and chief operating officer, Insurance Samadhan.
Why disputes arise
Conflicts typically stem from pricing disagreements, claim settlement delays, audits, and tariff renegotiations.
"Hospitals accuse insurers of seeking tariff cuts mid-cycle or during renewal, while insurers cite steep hospital charges, coding and documentation gaps, and inflated package rates," says Arora.
"While a suspension does not affect the validity of the underlying health insurance policies, it does change how the insured person can access hospital services," says Anju Thomas, associate partner, Aquilaw.
Patients worst hit
The biggest sufferers are patients.
The loss of cashless convenience -- often at preferred or nearby hospitals -- forces patients to pay upfront, sometimes in emergencies, and then navigate reimbursement paperwork that can take weeks or months to clear.
In some cases, hospitals are delisted mid-treatment.
"This causes confusion and anxiety, and sometimes forces patients to suddenly shift to alternative facilities. Such friction not only adds financial and logistical stress but also erodes consumer trust in health insurance," says Thomas.
Be financially prepared
To handle the sudden loss of cashless facility, patients should maintain an emergency fund or a short-term credit line to manage all or part of hospitalisation costs.
Make use of credit cards, personal loans, or loans for medical emergencies. “These should, however, be used cautiously after checking interest and other fees,” says Arora.
Negotiate with the hospital for phased payments or interim arrangements (stage-wise billing), so that you get some time to make the payment.
For queries, approach the assistance desks set up by hospitals during such suspensions.
"Submit claims promptly with all the invoices and receipts to avoid delays or rejection," adds Arora.
Stay alert for official updates from both your insurer and the hospital regarding reinstatement of cashless facility or temporary support measures.
Limit disruption
If your preferred hospital is delisted by your insurer, minimise disruption by identifying alternative network hospitals nearby that you can go to in an emergency.
Reimbursement of claims may not always be smooth. "Patients often face delays, deductions, or rejections over documentation or exclusions, forcing them to pay upfront and endure a lengthy, stressful recovery process," says Deepika Kumari, partner, King Stubb & Kasiva, advocates and attorneys.
"In case of delay or denial, use the insurer's internal grievance process and, if needed, approach the insurance ombudsman or the Insurance Regulatory and Development Authority of India (IRDAI) grievance portal," says Arora.
Precautions to exercise
Existing health insurance customers should check the insurer's list of empanelled hospitals regularly, as it tends to change frequently.
While buying a policy, new buyers should look beyond premiums. "They should factor in the claim settlement ratio, hospital tie-ups in their city, and service reputation," says Kumari.
They should also clarify the admission process and reimbursement timelines.
Practical steps for policyholders
Source: Insurance Samadhan
Feature Presentation: Rajesh Alva/Rediff
