No cashless treatment for Bajaj Allianz starting next month, CARE Insurance also issued notice, says AHPI

The Association of Healthcare Providers-India (AHPI), which has over 20,000 hospitals in its network across the country, including major hospital chains such as Max Super Speciality, Fortis Escorts and more, have directed all their member hospitals across north India to suspend cashless treatment facilities for Bajaj Allianz General Insurance effective September 1, 2025.

A similar notice has been sent to CARE Health Insurance, with AHPI seeking a response to the same by August 31, 2025. In the event of no response, AHPI will also suspend the cashless treatment facility for CARE policyholders.

If implemented, those holding a health insurance policy with Bajaj Allianz General Insurance or CARE will have to pay for any medical or hospitalisation-related expenses from their own pockets, and later claim reimbursements from the insurer.

What were the reasons for the suspension?

As explained by Dr. Girdhar Gyani, director general, AHPI, in their press statement, “Medical inflation in India remains in the 7-8% range every year, driven by rising staff costs, medicines, consumables, utilities, and overheads. While hospitals strive to enhance efficiency, it is not viable to operate at outdated reimbursement rates, much less lower ones. Continuing under such terms risks compromising patient care, which AHPI and its members cannot allow.”

As per AHPI, Bajaj Allianz have long rejected their proposal of reviewing tariff rates every 2 years to keep them in line with medical inflation, along with demanding tariff cuts. Apart from this, as AHPI noted, member hospitals have also alleged claim settlement delays and long discharge approval against Bajaj Allianz General Insurance.

Bhaskar Nerurkar, Head- Health Administration Team, Bajaj Allianz General Insurance, noted that while they were surprised at this announcement, they are confident of working amicably with AHPI and member hospitals to solve this issue.

At present, AHPI has around 615 network hospitals in Delhi-NCR, around 511 hospitals in Punjab, 242 hospitals in Uttarakhand, and around 1,220 hospitals in Uttar Pradesh. AHPI representatives are reportedly scheduled to meet CARE Health officials on Wednesday and Bajaj Allianz General Insurance on Thursday this week to resolve these issues.

CARE surprised, said AHPI did not provide any specific details

According to Manish Dodeja, Chief Operating Officer, Care Health Insurance, they received an email from AHPI on the evening of August 22, 2025, which was generic and did not carry any details of the affected providers, tariffs or claim deduction challenges.

“We have also reached out to hospitals (Members of AHPI) who haven’t mentioned any challenges with our services”, he added.

As per IRDAI’s Handbook on India's Insurance Statistics for 2023-24, Bajaj Allianz had a claim settlement ratio of 95.99%, while Care Health stood lower at 92.77%. This ratio indicates that out of every 100 claims that an insurance company receives, how many it actually honours.

This is not the first tariff-related skirmish for CARE Health Insurance this year. In April, the Ahmedabad Hospital and Nursing Home Association (AHNA) had also announced that it will be stopping cashless treatment facility across Ahmedabad for 3 insurers, namely Tata AIG, Star Health and CARE Health. However, in May, cashless treatment option was reinstated for CARE and Star Health, but not for TATA AIG.

CARE Health had also ceased to provide a cashless treatment facility at Max Hospitals across Delhi-NCR effective February 17, 2025. As of August 25, 2025, the suspension remains in effect, with CARE not offering cashless treatment options at Max Hospitals in Delhi-NCR, which includes 8 super-speciality hospitals, 2 multi-speciality centres, one hospital in Gurgaon, and one cancer care centre in Lajpat Nagar, Delhi.

"We are committed to providing access to quality healthcare at affordable premiums. With immediate effect, we have ceased cashless claim services at all Max Hospitals-NCR due to unsustainable demands from a customer's perspective”, reads the insurer’s website.