Star Health and Allied Insurance Company Limited, India’s largest standalone health insurer, is accelerating its adoption of artificial intelligence (AI) to automate the settlement of cashless hospitalisation claims. The company expects that more than half of its cashless claims could be processed through AI systems within the next two years.
AI to Improve Claims Processing Efficiency
Currently, around 20% of Star Health’s claims are handled using AI-powered systems. These technologies help automate parts of the claims workflow, allowing the company to process requests faster while maintaining regulatory compliance.
AI-driven systems assist in managing critical processes such as pre-admission approvals and post-discharge claim settlements, helping the insurer meet strict turnaround timelines.
Under regulatory guidelines, pre-admission authorisations must typically be completed within one hour, while post-discharge approvals should be processed within three hours, making automation increasingly important for operational efficiency.
Target to Cross 50% AI-Processed Claims
Given that nearly 85% of the company’s claim value is cashless, Star Health aims to significantly expand the role of automation in its operations. The company plans to increase the proportion of AI-processed claims to over 50% within the next two years.
Despite this automation push, human oversight will remain essential. Manual review will primarily focus on complex cases, high-value claims, and situations requiring fraud detection.
Industry Collaboration and Hospital Network Expansion
Industry bodies such as the General Insurance Council are working with hospitals to establish a standardised schedule of treatment rates, aimed at improving transparency and streamlining claim settlements.
As part of this effort, insurers are looking to empanel around 10,000 hospitals nationwide. The initiative also involves digital integration through platforms like National Health Claims Exchange (NHCX) and the Ayushman Bharat Health Account (ABHA), which are designed to simplify healthcare data exchange and billing processes.
Summary:
Star Health plans to expand the use of AI in processing cashless hospitalisation claims, aiming to increase AI-handled claims from the current 20% to over 50% within two years. The move is expected to improve efficiency and regulatory compliance, while human oversight will continue for complex and high-value claims. Industry initiatives to standardise hospital rates and enhance digital integration are also expected to support faster claim settlements.
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