Network And Non-Network Hospitals: What’s The Difference?

Choosing a medical insurance plan can be confusing, there are several options available and so many things to consider. As with everything else in life, being armed with knowledge helps make the decision easier. This article’s goal is to do just that, provide you with information that will help you make a better, more informed decision.

One of the most crucial aspects to consider while deciding on an insurance plan is the number of hospitals in the company’s network. The larger that number is, the better your experience will be as the claims process at a network hospital is relatively smooth and hassle-free.

However, this still leaves several questions unanswered. This blog will cover those questions, focusing on what network hospitals are, how they differ from non-network ones, what you expect the claims process to look like at both these hospitals, and finally, which hospital to choose and when.

What are Network Hospitals?

In order to avoid paying out large claims to policyholders, insurance providers frequently enter into partnerships with certain hospitals. These hospitals then become a part of the company’s network. This arrangement allows the insurance holder to avail of cashless treatment at any network hospital. The claims process at network hospitals is settled between the hospital and insurance provider and barely involves the patient at all.

What are Non-Network Hospitals?

Non-Network hospitals are the ones that the company has not entered into a partnership with. Hence the cashless treatment facility is not available at this hospital. If one is treated at a non-network hospital, the insurance holder will first have to take care of the cost of treatment by themselves, and later file for a claim at their insurance company, and then be reimbursed by the company later if the company accepts the claim that is. If they reject it, the process becomes much longer.

The Difference: Claims Process

The claims process for the insurance plays out very differently at both these types of hospitals. One is short and crisp, while the other can be very long and drawn out.

To make it easy for you to understand, both processes are explained through some examples given below.

Scenario A: Claims process at a network hospital

Mr Amit goes to a hospital that is in his insurance company’s network for surgery, deciding that his medical insurance would cover the cost of this procedure. While in the hospital, he approaches the insurance desk and fills out the pre-authorization form. This form is then forwarded to the third-party administrator, who checks its details and approves it, sending his approval letter which also mentions the eligible amount of money as per policy terms and conditions that Mr Amit could use for this surgery.

The payment settlement happens between the hospital and the insurance company. The hospital presents the paid medical bill along with the cost breakdown to Mr Amit before he is discharged.

Here’s a quick summary of the steps for the claims process at a network hospital:

Fill Pre-Authorization Form ⇒ Get Third Party Administrator’s approval ⇒ Avail Cashless Treatment.

Scenario B: Claims process at a non-network hospital

Mr Bhagat is admitted to a non-network hospital for his surgery. At the end of his stay at the hospital, he is billed for his treatment. Mr Bhagat has to pay the money upfront, which is stressful as his surgery was expensive.

After paying the bill out of his pocket, he has to spend his time collecting insurance documents, medical bills and filing claim forms to send to his insurance provider. Mr Bhagat had to wait for 15 days before the insurance company reimbursed the money he spent for the surgery.

Here’s a quick summary of the steps for the claims process at a network hospital:

Pay Hospital Bill ⇒ Gather all Receipts, Bills and Medical Reports ⇒ Fill Out Claim Form  Get the Form Stamped by the Hospital ⇒ Send Forms to Insurance Provider ⇒ Fight Claim if Rejected ⇒ Get Reimbursed

Which hospital to choose?

The hospital you choose to be treated at should depend on the situation. If the patient’s condition is critical, the only concern should be moving them to the nearest hospital, regardless of whether or not it’s a network hospital. In those situations, a few minutes can be the difference between life and death.

However, if you have the time to choose, it is always better to go to a network hospital. As mentioned before, treatment at network hospitals is cashless and will not require you to pay wholly out of your own pocket as the insurance company will settle the bill directly with the hospital. This feature saves you from being stretched thin between the paperwork and the claims process so that you can spend your time focusing on your recovery and the health of your family.

DISCLAIMER- The information contained in this blog is provided solely for general interest and may not reflect the requirements of each individual/company. Please speak to an insurance expert before making any decision.

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