Bajaj Allianz Customers to Lose Cashless Treatment at 15,000 Hospitals from September 1

From September 1, thousands of Bajaj Allianz policyholders across India may face a major setback. Around 15,000 hospitals, including leading chains such as Max Healthcare and Medanta, will stop offering cashless treatment facilities to Bajaj Allianz General Insurance customers. This decision has been announced by the Association of Healthcare Providers-India (AHPI), which represents these hospitals.

Why the Suspension?

According to AHPI, the move comes after repeated complaints from its member hospitals against Bajaj Allianz. The complaints include:

• Low reimbursement rates compared to rising medical costs

• Unilateral deductions during payments

• Delays in claim settlements

• Slow approval process for pre-authorization and discharge requests

The association highlighted that despite India’s medical inflation rising at an average of 7–8% annually, Bajaj Allianz has not revised its reimbursement tariffs for years. In fact, hospitals allege that instead of raising the tariffs, the insurer has asked for further reductions, making it unviable for hospitals to provide quality care under the existing arrangement.

Financial Strain on Hospitals

AHPI Director General Girdhar J. Gyani explained that the costs of manpower, medicines, and utilities have been steadily increasing, which directly impacts healthcare delivery. Hospitals have consistently urged insurers to review tariffs every two years, but Bajaj Allianz has resisted these changes.
“Providing treatment at outdated rates is simply not sustainable,” Gyani said. “Hospitals cannot continue to absorb rising costs while patients expect world-class care.”

Impact on Policyholders

With this decision, Bajaj Allianz customers will no longer enjoy cashless treatment at these hospitals. Instead, they will be required to pay their bills upfront under a self-pay model and then file for reimbursement from the insurance company. This is expected to place a temporary financial burden on patients, especially those undergoing expensive procedures.

Previously, cashless treatment allowed hospitals to directly settle expenses with the insurer, sparing patients from making large out-of-pocket payments during emergencies. The withdrawal of this facility could therefore cause stress for families seeking urgent care.

Bajaj Allianz Responds

Bajaj Allianz, however, maintains that it is committed to resolving the issue. Bhaskar Nerurkar, Head of Health Administration Team at Bajaj Allianz, confirmed that the insurer has already scheduled a meeting with AHPI representatives on August 28.
“We are fully committed to finding a solution through dialogue,” Nerurkar said. “Our goal is to ensure our customers continue to receive uninterrupted, high-quality healthcare services. We are confident this matter can be resolved amicably.”

What’s Next for Customers?

Until a settlement is reached, policyholders are advised to be prepared for the self-pay route at AHPI-affiliated hospitals. Patients will need to clear their medical bills at the time of discharge and later submit claims to Bajaj Allianz for reimbursement.

For minor treatments, this may not cause much disruption, but in cases of serious illness or surgery where bills can run into lakhs, the impact could be significant. Patients may need to arrange emergency funds before accessing treatment.

Broader Implications for the Industry

The conflict highlights a larger challenge in India’s health insurance sector — the gap between rising healthcare costs and stagnant insurance reimbursement rates. With medical inflation steadily climbing, hospitals argue that insurers must update tariffs regularly to ensure sustainable and quality care.

If unresolved, the standoff between hospitals and insurers like Bajaj Allianz could set a precedent, potentially affecting millions of policyholders and their access to cashless treatment across India.