NPS Swasthya Pension Scheme:
The Pension Fund Regulatory and Development Authority (PFRDA) recently rolled out the NPS Swasthya Pension Scheme (NSPS) on a pilot basis.
- NPS Swasthya Pension Scheme (NSPS) is a new initiative launched by the Pension Fund Regulatory and Development Authority (PFRDA) as a Proof of Concept (PoC) under its Regulatory Sandbox Framework.
- The initiative aims to integrate health-related financial benefits with the existing National Pension System (NPS) framework.
- The scheme is designed to provide financial support for out-patient and in-patient medical expenses.
- The scheme will function as a sector-specific contributory pension scheme within the Multiple Scheme Framework (MSF) of NPS and will be offered to Indian citizens on a voluntary basis.
- It will be launched by Pension Funds after obtaining prior approval from PFRDA.
- As it is being implemented as a pilot project, only a restricted number of subscribers will be enrolled during the PoC phase.
- To facilitate the pilot, certain provisions of the PFRDA (Exits and Withdrawals under NPS) Regulations, 2015, have been relaxed.
- Pension Funds may also collaborate with FinTech firms and health service administrators to implement the scheme.
- Any Indian citizen is eligible to join the scheme, but a Common Scheme Account under NPS is mandatory.
- Subscribers can contribute any amount, in line with existing NPS guidelines applicable to the non-government sector.
- Subscribers aged above 40 years (excluding government sector subscribers) may transfer up to 30% of their contributions from the Common Scheme Account to the Swasthya Pension Scheme.
- Partial withdrawals are permitted for medical expenses up to 25% of the subscriber’s own contributions, with no limit on the number of withdrawals, subject to a minimum accumulated corpus of ₹50,000.
- In cases of critical inpatient treatment, where medical expenses exceed 70% of the available corpus, subscribers may opt for 100% premature withdrawal solely to meet such medical costs.
