Citing low reimbursement rates and arbitrary payment deductions, the Association of Healthcare Providers-India (AHPI) announced on Friday that member hospitals in North India will stop offering cashless treatment facilities to Bajaj Allianz General Insurance policyholders effective September 1, 2025.
15,000+ Hospitals Join the Suspension
AHPI, which represents over 15,200 hospitals, including major players such as Max Healthcare, Medanta, and PSRI, confirmed that a majority of its members will suspend cashless services. These hospitals will, however, continue to treat Bajaj Allianz policyholders on a self-pay basis. Patients can later seek reimbursement directly from the insurer.
Reasons Behind the Move
As reported by Business Standard, member hospitals raised repeated complaints against Bajaj Allianz, pointing to unilateral deductions, delays in payments, and long approval timelines for pre-authorisation and discharge. Furthermore, hospitals alleged that the insurer refused to revise reimbursement rates in line with medical inflation. Instead, the company reportedly pressured providers to reduce tariffs that had been fixed years ago under expired contracts.
AHPI Calls for Fair Tariff Revisions
AHPI emphasised that medical inflation in India consistently hovers between 7–8% annually, driven by rising personnel costs, medicines, consumables, utilities, and overheads. Director General Girdhar Gyani stated that continuing to operate under outdated rates—or lowering them further—was unsustainable and risked compromising patient care.
The body reiterated its demand for tariff reviews every two years to align with medical inflation. According to AHPI, Bajaj Allianz not only rejected these proposals but also sought further tariff reductions, creating what hospitals described as an “untenable situation.”
Warning Issued to Care Health Insurance
Alongside this decision, AHPI issued a notice to Care Health Insurance, asking for a response by August 31. If the insurer fails to comply, member hospitals will extend the suspension of cashless services to Care Health policyholders as well.
Bajaj Allianz Responds
In response, Bhaskar Nerurkar, Head of Health Administration at Bajaj Allianz General Insurance, expressed surprise over the announcement. He stated that the company remained committed to ensuring policyholders receive fair rates, seamless claims, and quality service. He added that Bajaj Allianz continues to engage with hospitals to resolve queries and settle dues, and expressed confidence in reaching an amicable solution with AHPI.