Hospital cash plan

Hospital cash plan is not a substitute for health insurance, but a supplement to the existing health insurance covers bought individually or provided by the employer

October 08, 2012 3:03 IST | India Infoline News Service
It is rightly said, ‘Health is wealth’. Good health is the most valuable asset that we have, but nowadays with increasing levels of stress, negligible physical activity and changing lifestyle our vulnerability to diseases is increasing at an alarming pace.

The cost of healthcare is rising everyday and more than the cost of your treatment, indirect costs like—hospital room rent, nursing expenses, post discharge expenses, recuperating expenses, ambulatory charges, etc account for a major part of the overall cost incurred. To cover these expenses, many non-life insurers are offering hospital cash plans.

Hospital cash plan is designed to pay the policyholder a lump sum for each day he needs treatment as an in-patient, in either a government or private hospital. This plan pays a fixed daily hospitalisation cash—the amount helps to pay for any kind of expenses incurred before, during or post hospitalisation. 

Hospital cash plan vs health insurance 
Hospital cash plan is not a substitute for health insurance, but a supplement to the existing health insurance covers bought individually or provided by the employer. While health insurance helps you take care of hospital & medical bills, there are several other expenses incurred during hospitalisation such as charges for patient’s diet, patient’s attender’s lodging, money spent on commuting from home to hospital and back.

Health insurance reimburses inpatient hospital bills. Hospital cash plan offers you fixed daily benefits, per 24 hours spent in hospital. The product is aimed at covering incidental expenses incurred during hospitalisation which are normally not covered under health insurance.

It is not necessary to have a health insurance policy to buy a hospital cash plan. But it is always advisable to buy a medical insurance policy plus a critical health insurance cover first. Hospital cash plan is not a substitute of health insurance. Rather it acts as a supplement.

The cover is usually available for self, spouse, dependent parents, dependent children from the age of 1 year to 60 years. Generally, the policy can be renewed up to 70 years of age. Some insurers also provide discount on total premium, if you cover more than two family members under the policy. One can check the terms & conditions of the product with the respective insurer before buying it. Normally, hospital cash plan covers treatment availed only in India.

Claim procedure
The policyholder has to submit the duly filled claim form with requisite documents normally within 10 days from the date of discharge to their respective insurer. These documents include photocopy of doctor’s certificate, discharge summary, diagnostic test reports and FIR (in case of an accident).

The claim amount will be made by way of cheque for period of hospitalisation found admissible after the insurer receives the claim form, which is to be submitted within 10 days after discharge.

A few important exclusions are under the hospital cash plan includes pre-existing diseases, disease contracted during the first 30 days of commencement of policy, hospitalisation in an ayurvedic/homeopathic hospital. The plan also excludes certain treatment/diseases during first year of policy such as: congenital internal diseases, cataract, benign prostatic hypertrophy hysterectomy, knee / hip joint replacement among others. One needs to carefully read and understand the terms and conditions, before he buys the policy.

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