The third insurer to halt cashless claim services with Max Hospitals is Tata AIG.
As the gap between insurers and hospital chains grows, Tata AIG General Insurance is the third insurer, after Star Health and Niva Bupa, to terminate its cashless settlement agreement with Max Hospitals, requiring policyholders to pay for their care up front.
Tariffs are at the heart of Tata AIG’s decision, which goes into effect on September 10.
A two-year tariff agreement that went into effect on January 16, 2025, and ended on January 15, 2027, was negotiated, extended, and signed by Max Healthcare and TATA AIG General Insurance Company. But in July 2025, TATA AIG unexpectedly requested a meeting and made demands for more rate cuts. They threatened to halt cashless services and unilaterally suggested lowering the agreed-upon pricing. A Max Healthcare representative responded to Moneycontrol’s questions on September 26 by saying, “Cashless services at our hospitals were terminated effective September 10, 2025, when we did not accept it.”
“With Tata AIG, there was no tariff conflict. Any more decrease, in our opinion, is not feasible and would jeopardize patient safety and treatment quality. In order to assist patients, Max Healthcare has established an express counter where they may submit claims for insurance reimbursements without having to pay in advance at Max Hospitals.
Moneycontrol has not received a response from Tata AIG.
Prior to Star Health suspending cashless services, a number of Association of Healthcare Providers of India (AHPI) member hospitals—including major tertiary care chains—were left to handle patients in distress.
A number of hospitals, including Care Hospitals (Ramnagar, Vizag), Manipal Hospitals (Delhi and Gurugram), Max Hospitals (North India), Metro Hospital (Faridabad), Medanta Hospital (Lucknow), Rajiv Gandhi Cancer Hospital (New Delhi), Sarvodaya Hospital (Faridabad), and Yatharth Hospitals, were under suspension in a “arbitrary manner,” according to AHPI.
Following discussions, they agreed to reinstate cashless services at hospitals that are AHPI members starting on October 10.
The issue was rectified, despite AHPI’s advice to its member hospitals in the north to stop providing cashless medical services to Bajaj Allianz General Insurance clients as effective September 1.
Although recent agreements show a desire to work together, these events underscore the continued conflict between insurers and healthcare providers regarding cashless arrangements.