PFRDA Unveils NPS Swasthya Pension Scheme to Cover Medical Expenses
In a significant move to enhance financial security for retirees, the Pension Fund Regulatory and Development Authority (PFRDA) has launched the new 'NPS Swasthya Pension Scheme' on Tuesday. This innovative initiative is designed to assist subscribers in managing both outpatient and in-patient medical expenses by leveraging their pension savings, addressing a critical gap in healthcare financing for the elderly.
Key Features of the NPS Swasthya Scheme
The scheme operates as a contributory program under the Multiple Scheme Framework (MSF), offering flexibility and voluntary participation for Indian citizens. Initially, it is being tested as a pilot project within the regulatory sandbox framework, allowing for controlled experimentation and refinement before a full-scale rollout.
According to a circular issued by the pension fund regulator, the scheme will be launched by pension funds (PFs) for a limited duration. These PFs may also collaborate with FinTechs and other entities to enhance the scheme's implementation and accessibility, fostering innovation in the pension sector.
How the Scheme Works
Subscribers have the flexibility to contribute any amount to the scheme, adhering to the extant guidelines, which empowers them to tailor their savings based on individual healthcare needs. The contributions will be invested by the pension funds in accordance with the investment guidelines prescribed under the MSF, ensuring prudent management and potential growth of the funds.
This launch marks a proactive step by PFRDA to integrate healthcare coverage into pension planning, potentially reducing out-of-pocket medical expenses for millions of Indians in their retirement years.
