PM-JAY, TPA and Insurance Claims: What Your Hospital Software Must Do

Why claims need more than a billing screen

For many Indian hospitals, a large part of inpatient revenue comes from someone other than the patient: a government scheme, a health insurer through a Third Party Administrator (TPA), or a corporate. Each payer has its own rules for approval, rates and documents. When those rules live only in the billing clerk's head and a spreadsheet, claims are delayed, amounts are deducted and receivables are hard to see.

Good hospital software does not replace the payer's portal. It makes sure the hospital's own record (admission, services, bills and documents) is complete, consistent and ready when the claim is filed, and it shows the owner what is still owed.

Three kinds of payers, three workflows

One admission can involve more than one payer, for example an insurer for the approved amount and the patient for non-payable items. The software must therefore split a single bill between payers, not keep separate bills that never reconcile.

PM-JAY in brief for hospitals

Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY), implemented by the National Health Authority, provides eligible families cover of up to ₹5 lakh per family per year for secondary and tertiary hospitalisation, cashless at empanelled public and private hospitals. Details for beneficiaries and hospitals are on the official PM-JAY portal.

Hospitals join through empanelment by the State Health Agency, against general and specialty criteria set out in the NHA's guidelines on hospital empanelment. Treatment is billed against defined health benefit packages, and pre-authorisation and claims are handled on the scheme's own IT system, usually by a dedicated scheme desk at the hospital. Some states run their own schemes alongside PM-JAY or have their own processes, so confirm the current rules with your State Health Agency.

Private insurance and TPA: the cashless timelines

For private health insurance, the IRDAI Master Circular on Health Insurance Business of 29 May 2024 sets clear expectations for insurers:

• Insurers must decide on a request for cashless authorisation immediately, and in not more than one hour of receiving it.
• Insurers must grant final authorisation within three hours of receiving the hospital's discharge authorisation request, and the patient should not be made to wait for discharge.
• If there is a delay beyond three hours, any additional amount charged by the hospital is to be borne by the insurer.
• Insurers or TPAs collect the documents they need from the hospital; the policyholder is not required to submit them.

These rules put the hospital's documentation on the critical path. If the discharge summary, final bill and reports are not ready when the discharge request is sent, the clock cannot help anyone. The same circular asks insurers to onboard hospitals on the National Health Claims Exchange (NHCX), the NHA's platform for exchanging claim information digitally between hospitals, insurers and TPAs. Our guide to NHCX for hospitals covers how it works and what to ask vendors.

What your hospital software must do at each stage

Documents to keep ready for every claim

Exact requirements vary by payer and by package, but most claims draw on the same set of records. Keeping them in the hospital software, linked to the admission, saves the scheme desk and billing team from collecting paper at the last minute.

• Patient identity and the scheme card or policy details.
• Pre-authorisation request and approval, with any enhancement approvals.
• Admission notes, clinical findings and the treating doctor's notes.
• Investigation reports, including lab and imaging.
• Operation notes, and implant or high-value consumable details where relevant.
• Itemised final bill, pharmacy bills and payment receipts.
• Signed discharge summary (see our discharge summary format guide).

Common reasons for deductions and delays

Reports the owner and billing head should review

• Claims pending by payer and by age (for example, under 30, 30 to 60 and over 60 days).
• Pre-authorisations pending and enhancements requested.
• Deductions by payer and by reason.
• Revenue split by payer type: scheme, insurance, corporate and self-pay.
• Average days from discharge to claim dispatch, and from dispatch to settlement.

Owners with several branches should see these figures for each branch and for all branches together, and a weekly review of deductions by reason is one of the quickest ways to find a fixable process problem. Our hospital billing software guide covers the wider billing workflow, including deposits, packages and GST basics.

Questions to ask a software vendor

• Can we keep separate tariffs and packages for each scheme, insurer and corporate?
• Can one bill be split between a payer and the patient, with non-payable items shown?
• Does the software record pre-authorisation, approved amounts and enhancements?
• Can we see claims pending by payer and age without a spreadsheet?
• Which scheme portals or claim exchanges, such as NHCX, does the software connect to today? Show us.
• Do the discharge summary and bill come from the same record?

How Sehat Nxt helps

In Sehat Nxt, hospital billing keeps a payer master, records the patient category for each visit, splits a bill between the patient and a payer such as an insurer or government scheme, and tracks TPA claims from dispatch and acknowledgement through to settlement, with deductions recorded. Charges reach the bill from IPD management, the laboratory and the pharmacy, and the discharge summary sits with the same admission.

It suits nursing homes, small hospitals and multi-specialty hospitals. Plans start from ₹999 per month. Book a free demo and ask us to walk through one TPA admission and one scheme admission end to end.