The scheme, launched for a limited and controlled period, is designed to provide financial support for out-patient and in-patient medical expenses. It will operate under the Multiple Scheme Framework (MSF) and will be contributory in nature, offered voluntarily to Indian citizens.
Pension Funds (PFs), with prior approval from PFRDA, will administer the scheme in collaboration with Central Recordkeeping Agencies (CRA) and Health Benefit Administrators (HBA) or Third-Party Administrators (TPA). FinTech companies may also participate in the PoC. Provisions of the PFRDA (Exits and Withdrawals under NPS) Regulations, 2015, have been relaxed to facilitate testing under the sandbox framework.
The scheme allows subscribers to contribute any amount, which PFs will invest according to MSF guidelines. Individuals over 40 years can transfer up to 30% of their contributions from their NPS Common Scheme Account to the Swasthya Pension Scheme. Partial withdrawals for medical expenses will be permitted up to 25% of the subscriber’s own contributions, with the first withdrawal allowed after a minimum corpus of ₹50,000.
In cases where a single medical expense exceeds 70% of the subscriber’s corpus, premature exit with 100% lump-sum withdrawal will be allowed. Withdrawn amounts will be settled directly with the HBA/TPA or hospital, and any remaining balance will revert to the Common Scheme Account.
The PFRDA has mandated that PFs, in consultation with HBAs/TPAs, establish a robust grievance redressal mechanism, ensuring timely resolution of subscriber concerns. Subscriber-level data sharing for claims will comply with the Digital Personal Data Protection Act, 2023, requiring explicit digital consent at the time of scheme activation.
The PoC will help PFRDA assess the operational, technical, and regulatory viability of combining pension and health benefits within the NPS structure, potentially paving the way for a full-scale rollout in the future.
