Mixed reactions: Telangana Employee Health Scheme revamp ups concern on govt funding

Hyderabad: The Telangana government’s latest announcement of a revamped cashless Employee Health Scheme (EHS) has received mixed reactions from government employees and pensioners.

Weighing pros and cons of a cashless system

On one hand, the promise of truly cashless medical treatment for a wide range of procedures is welcome news for the government employees after years of complaints about the old system.

Previously, there have been complaints about delays in payments to hospitals, issues with health cards, and out-of-pocket expenses that added stress during illnesses, which might be mitigated by a cashless system.

On the other hand, there’s worry about whether the State will consistently match its share of the funding.

What is the Employee Health Scheme about?

The scheme, approved by the State Cabinet, chaired by Chief Minister A Revanth Reddy on February 23, will cover 3.56 lakh regular employees, 2.88 lakh pensioners, and their dependent family members—a total of about 17.07 lakh people.

As per the scheme:

- Beneficiaries will get completely cashless treatment at all government hospitals and 652 empanelled private hospitals, with coverage for 1,998 different medical procedures.

- Everyone will receive a digital health employee card to make access straightforward.

The program will run through the Rajiv Arogyasri Health Care Trust, comprising senior officials and employee unions' representatives, which should bring more reliability than before, the government said.

How will the government fund the scheme?

Funding comes from equal contributions.

Employees and pensioners will see 1.5 per cent deducted from their basic pay or pension each month, adding up to roughly Rs 528 crore a year from their side.

The government has committed to matching that amount with another Rs 528 crore, for a total annual pool of Rs 1,056 crore.

CM Revanth Reddy emphasised that health and family security for employees are top priorities, and the Cabinet described this as proof of the ‘People’s Government’ delivering on its promises.

The scheme is expected to roll out soon, though exact start dates point toward early implementation following the Cabinet nod.

What are the concerns regarding the scheme?

That said, there are concerns being raised about its implementation.

In employee circles and union discussions over the past day or so, the big question keeps coming up: What happens if the government’s contribution doesn’t come through regularly and on time?

With the State’s fiscal situation allegedly already tight, many fear deductions might start from salaries while the promised matching funds lag, putting the scheme’s long-term viability at risk.

Lower-paid staff, especially in Group D and non-gazetted roles, find the 1.5 per cent cut too steep—it hits harder on smaller salaries—and some have suggested dropping it to 1 per cent or switching to a fixed amount, like Rs 250 to Rs 1,000 per month, similar to models in other schemes.

Teachers’ groups, including the Telangana State United Teachers’ Federation, have been particularly outspoken against the percentage-based approach, saying it unfairly burdens those earning less.

Employees welcome 'historic' decision

The Telangana Government Employees Joint Action Committee (TGEJAC) has welcomed the Cabinet’s decision overall, calling it historic and thanking the Chief Minister, Deputy CM Mallu Bhatti Vikramarka and ministers like Ponguleti Srinivas Reddy, Sridhar Babu, Ponnam Prabhakar and Damodar Rajanarasimha.

TGEJAC leaders, including Chairman Maram Jagadishwar and Secretary General Eluri Srinivas Rao, highlighted how the scheme addresses past hardships—mental strain from irregular payments and limited benefits under earlier setups.

They also noted related reforms, like shifting certain staff to direct treasury payments and opening promotion opportunities for nurses.

However, the committee said it plans to raise employees’ concerns directly with the CM, pushing for firm assurances that the government’s share will be released without fail every year.

Overall, many consider it a significant step forward for employee welfare in Telangana, paired as it is with a separate accident insurance scheme offering up to Rs 1.2 crore coverage.

But its success will depend on steady execution and trust that both sides hold up their end of the bargain. Employees are watching closely as details unfold.