For those who consider all health or hospital plans as regular health insurance plans, here is the spoiler, they are not. So if you have received calls urging you to buy a health plan in which you do not need medical tests, where all diseases are covered; then they might be talking about the Cash Health Plan or Hospital Cash plan.
Please note that all plans are not regular health insurance and let not the sweet talking sales guy make you buy something you don’t need.
3 Signs that the plan you are buying is a Cash Plan:
Sign no.1: It pays fixed amount per day of hospitalization, irrespective of the expenses.
On the other hand Health Insurance in India, pays you for on the admissible medical expenses incurred on Hospitalization as per the terms and conditions of the policy.
Sign no.2: It pays irrespective of what you spend. The reimbursement is based on purely number of days of hospitalization.
Health Insurance on the other hand pays for hospitalization charges, doctor fees, surgery costs, and pre and post medical expenses.
Sign no.3: It does not require medical tests. It is available to anyone from an age of 25 to 60.
Health Insurance on the other hand may require medical tests before coverage in a policy.
From the differences given above, you may feel that buying a health Cash Plan is a better option as it has few conditions and covers more.
But don’t be drawn into it by the convenience projected, a Cash Health Plan mostly ends up paying less than a Medical insurance Policy and here is how.
Cash Health Plan :Mistaken Identity
Anuj bought a Cash health plan thinking it was a medical insurance policy. Anuj then had to go through a surgery for which he stayed in the hospital for 5 days. The cost of the surgery was Rs.50,000 and the other expenses incurred by the family like transportation, medicines, fruits etc. came to Rs.2000.
The Health Cash Plan paid him only Rs. 5000 as per Rs. 1000/day. Anuj ended up paying Rs. 45,000 from his own pocket.
A Medical Insurance Policy on the other hand would have paid him the entire amount of the surgery and would have also reimbursed him for the expenses incurred after the surgery for up to 60 days as Post hospitalization expenses.
So what would you prefer- being paid for the expenses incurred or just the stay?
Cash Plan is Not a Substitute but a Supplement
Do not substitute buying Regular/Standard Mediclaim with a Health Cash Plan. A Health Cash Plan is an excellent supplement to your existing Medical insurance Policy. So you don’t just get the hospitals bills covered, but you also get paid for the additional expenses which aren’t covered by a Mediclaim.
As a Supplement, here’s how a Cash Health Plan works:
Daily Allowance: Rs. 1000-Rs 2500/day for a maximum of 30-60 days depending on the type of plan.
Documents required: Photocopy of the discharge sheet, copies of reports, prescriptions for the claims process.
Maximum Duration: Daily allowance is paid for maximum 30 days - 60 days, as per the plan.
Premium: You could either pay for a 30 days or 60 days cover. The premium is charged according the age of the person as well as the period of maximum coverage.
Exclusions: No disease is covered until 30 or 90 days of buying a policy according to the Company. Also it does not cover pre-existing diseases, dental treatment, pregnancy and childbirth.
Best option: Use it as a supplement along with Critical illness policy or medical insurance policy and get best of both.
Some of the Health Cash Plans: Hospital Cash by Bajaj Allianz and Hospital Care by TATA AIG.
