NPS Swasthya Pension Scheme 2026: New Health Benefit Pension Plan Launched by PFRDA

The Pension Fund Regulatory and Development Authority (PFRDA) has introduced a groundbreaking NPS Swasthya Pension Scheme as a Proof of Concept under its Regulatory Sandbox Framework. This innovative scheme, announced via circular PFRDA/2026/07/SUP-CRA/02 dated January 27, 2026, aims to integrate health benefits with pension savings for the first time in India.

What is NPS Swasthya Pension Scheme?

The NPS Swasthya Pension Scheme is a health-focused pension scheme designed to provide financial support for both outpatient and inpatient medical expenses within the existing National Pension System (NPS) architecture. This scheme represents a significant step toward comprehensive retirement planning that addresses healthcare costs alongside pension savings.

Key Features of the Scheme

1. Dual Account System

Mandatory opening of Common Scheme Account alongside NPS Swasthya Pension Scheme Account. Both accounts work together to provide comprehensive financial security.

2. Flexible Contributions

Subscribers can contribute any amount to the scheme. It follows existing NPS guidelines for the Non-Government Sector. There is an option to transfer up to 30% of contributions from the Common Scheme Account for subscribers above 40 years.

3. Health-Focused Withdrawals

Partial withdrawals are permitted for medical expenses, including both outpatient and inpatient treatment. The withdrawal limit is up to 25% of the subscriber’s own contributions. There is no minimum waiting period after accumulating a ₹50,000 corpus and no restriction on the number of partial withdrawals.

4. Critical Medical Treatment Support

Premature exit is allowed for critical medical treatments. This option is available when medical expenses exceed 70% of the total corpus. In such cases, 100% lump sum withdrawal is permitted regardless of corpus size.

Eligibility Criteria

All Indian citizens are eligible for this scheme. Subscribers must have both a Common Scheme Account and an NPS Swasthya Pension Scheme Account. The scheme is available on a voluntary basis to NPS subscribers.

Financial Aspects

Transparent Fee Structure

Fees are governed by the Multiple Scheme Framework (MSF). These include charges payable to the Health Benefit Administrator (HBA). Complete transparency is maintained in all charges and benefits.

Investment Strategy

Contributions are invested by Pension Funds as per MSF guidelines, ensuring professional fund management within the regulatory framework.

Claim and Settlement Process

The scheme follows a Direct Payment System where withdrawn amounts are remitted directly to the HBA or TPA. Claims are processed based on valid documentation and supporting invoices. Any surplus amount after settlement is transferred back to the Common Scheme Account. A robust grievance resolution mechanism is in place, with Pension Funds taking responsibility.

Data Privacy and Security

The scheme complies with the Digital Personal Data Protection Act, 2023. Explicit digital consent is required for data sharing. Subscriber-level data is shared only for claim processing and is securely handled by authorized intermediaries.

Proof of Concept Nature

Limited Duration Launch

The scheme is launched as a Proof of Concept under the Regulatory Sandbox framework. It will operate for a limited duration with restricted subscriber registrations to assess operational, technological, and regulatory aspects.

Exit Options After PoC

If the scheme proves unviable after the Proof of Concept period, the accumulated corpus will be transferred to the Common Scheme Account or exited as per PFRDA (Exits and Withdrawals) Regulations, 2015.

Contact Information

Pension Fund Regulatory and Development Authority (PFRDA)

E – 500, Tower – E, Fifth Floor
World Trade Center, Nauroji Nagar
New Delhi – 110029
Phone: 91 – 11 – 40717900
Website: www.pfrda.org.in

Why This Scheme Matters?

The NPS Swasthya Pension Scheme addresses a critical gap in retirement planning by integrating healthcare with pension savings. It provides emergency medical funding without disrupting retirement corpus, offers flexible withdrawal options for medical needs, and ensures regulatory protection through PFRDA oversight.

Implementation Timeline

The scheme will be launched by Pension Funds after receiving PFRDA approval and will operate in a controlled environment. Collaboration with FinTech companies and other entities is permitted for implementation.

Important Note: This scheme is currently in the Proof of Concept stage. Subscribers should carefully review all terms and conditions before enrollment and consult with financial advisors if needed.

Stay updated with SA POST Blog for the latest developments on the NPS Swasthya Pension Scheme and other important government announcements affecting your financial planning.