Insurance companies will demand higher amount: Medisep premium amount to cross ₹750

THIRUVANANTHAPURAM: There are indications that the monthly premium in the second scheme of Medisep, the health insurance scheme for state government employees and pensioners, will be higher than the basic amount of Rs 750 approved by the cabinet. Insurance companies will put forward in the tender an amount higher than the amount of Rs 750 fixed by the government. Finance Minister K.N. Balagopal clarified in the assembly that the government will have to pay it.

The current monthly premium for the three-year plan is Rs 500. The government's stance is that the premium can be increased every year in the new plan. The government has agreed to allow a 5% increase in the first year's premium for the second year. The contract period for the second phase is two years.

Oriental Insurance Company, which took over the first scheme, had to pay a higher amount as treatment costs than the premium it received. There was a situation where the insurance company rejected claims worth about Rs 87 crore at the last stage. Insurance companies will come forward to take over the scheme only if the government accepts the higher premium.

The government has made it clear that it will not exempt low-wage employees and pensioners from being charged premiums. Employees point out that even though those receiving a basic pension of Rs. 11,500 and those receiving a basic pension of Rs. 83,500 receive the same treatment, having to pay the same amount of premium will create a huge financial burden.

Tender soon

• The first Medisep period ended in June. It was extended for three months. Since the tender for the second Medisep could not be secured, it was extended again till October 31. It has been decided to complete the tender process within that time and start the second Medisep.
• There were about 31 lakh people in the first Medisep, including 5.45 lakh employees and 5.89 lakh pensioners and their families.
• It has been decided to include employees of public sector undertakings, corporations, autonomous bodies, statutory bodies and cooperative sectors who do not have Employment State Insurance benefits in the second Medisep.
• It is indicated that the number of beneficiaries will cross 40 lakh. In the second phase, the insurance coverage has been increased to 5 lakh.

Paid as premium in first Medisep: 1749.70 crore

Disbursed as medical expenses: 1964.74 crore

The process for the new agreement is in progress. The premium will be finalised only after the insurance company is selected.

- Finance Department