Cashless facility lets you avail the hospitalization benefits without any advance payments.When you buy a policy from insurance company they provides you a health card along with your policy documents.You can use the health card to access Cashless facility in network of hospitals facilitated by the insurance company TPA (Third Party Administrators). SO, the eligible medical expense, thus incurred, shall be settled by the Insurance Company directly with the hospital.
This is what I know about cashless facilities.
Hope it is useful for you!