AHPI Demands Star Health Restore Cashless Services as Patients Bear the Brunt

The stand-off between hospitals and insurers has flared up once again, this time putting Star Health Insurance customers in a difficult position. The Association of Healthcare Providers of India (AHPI), which represents more than 15,000 hospitals across the country, has demanded the immediate restoration of cashless treatment facilities that Star Health has suspended at several major hospitals.

In its statement, AHPI named institutions such as Manipal Hospital (Delhi and Gurugram), Max Hospitals (North India), Medanta Hospital (Lucknow and Noida), Rajiv Gandhi Cancer Hospital (New Delhi), and others, where cashless services have been withdrawn.

AHPI has also flagged that empanelment of new hospitals, including Fortis Hospital in Manesar and Jupiter Hospital in Indore, has been put on hold, restricting access for patients who rely on cashless care.

"Patients buy health insurance with the clear expectation of receiving cashless treatment at quality hospitals. It is unjust for insurers to withhold this facility after collecting premiums, leaving families to scramble for funds at the time of hospitalisation," says Dr Girdhar Gyani, director general of AHPI, and Dr Abul Hasan, chairman of the IMA Hospital Board, in a joint statement after their meeting on September 14.

Why the clash matters

Cashless care has become the backbone of health insurance in India. Instead of arranging large sums at the hospital desk, patients depend on the insurer to settle bills directly with the hospital.

When the facility is suspended, families are forced to pay out of pocket and later apply for reimbursement, a process that is often slow and paperwork-heavy.

This is not the first flashpoint. Earlier, AHPI had raised similar concerns over Bajaj Allianz, Care Health, and Niva Bupa. Insurers accuse hospitals of inflating bills, while hospitals say insurers underpay, delay approvals, and impose unfair tariffs. Patients inevitably get caught in the middle.

The General Insurance Council (GI Council), representing all non-life insurers, has previously criticised AHPI for taking unilateral action, warning that such steps "Prejudice the interests of policyholders." But AHPI maintains that Star Health's suspensions and refusal to empanel new hospitals are themselves arbitrary and unfair.

What policyholders can do if cashless fails

For those who land in the hospital only to be told cashless is unavailable, the immediate priority is treatment. Experts say patients should not delay care.

"Pay the interim amount requested by the hospital to start treatment and preserve every document, diagnostic reports, prescriptions, discharge summary, and all original bills, "advises Sunny Bhatia, Senior VP, Retail at Turtlemint. "You can then either resubmit documents for cashless approval or file for reimbursement within 30 days of discharge, as per policy terms."

If a claim is denied upfront, policyholders can appeal with additional clarifications from doctors or test results. Importantly, a rejection of cashless does not mean loss of coverage; it only changes the mode of settlement. The financial protection remains intact, though the initial burden falls on the patient's family.

Growing unease among patients

Star Health has already faced scrutiny. According to the Council of Insurance Ombudsman's annual report, it received more than 10,000 complaints in the financial year 2023-24, the highest among health insurers, mostly linked to claim rejections.

For now, patients are left anxious. The bigger worry is that repeated disputes between insurers and hospitals, whether over tariffs, delays, or empanelment, are now beginning to shake public trust in health insurance itself. That trust is vital for families who bought policies precisely to avoid financial shocks during a medical emergency.