CGHS scheme may be stopped, New CGEPHIS scheme may be launched for Govt Employees [Scheme PDF]

There are reports that the central government is planning to introduce a new health scheme – Central Government Employees and Pensioners Health Insurance Scheme (CGEPHIS) in place of Central Government Health Scheme (CGHS).

Central Government Health Scheme (CGHS) is a scheme for providing healthcare to the serving as well as the retired Central Government Employees and their family members. CGHS is functioning under the Ministry of Health and Family Welfare (MoHFW) and the officers of the Central Health Service (CHS) provide healthcare to the beneficiaries and handles the administration of the wellness centres located throughout India.

Set up of New Pay Commission

In January 2025, the Indian government announced the formation of a new Pay Commission – 8th Pay Commission. The main responsibility of this commission is to review and recommend changes in the salary and pension structure for central government employees and pensioners. While most people think that the commission only works on suggesting salary hikes, its role is much broader. It also looks into other important aspects such as allowances, perks, and facilities, including healthcare benefits provided to employees.

One of the key areas the Pay Commission is expected to review is healthcare services for government employees and pensioners. At present, most central government employees and their families are covered under the Central Government Health Scheme (CGHS). This scheme offers affordable medical care, including doctor consultations, hospital treatments, diagnostic tests, and medicines. However, CGHS is available only in selected cities and towns, which means many employees and pensioners across the country cannot benefit from it. This limited reach has been a major concern for years.

The issue of healthcare coverage has been raised in earlier pay commissions too. The 6th Pay Commission recommended starting a new optional health scheme where employees could voluntarily join by paying a fixed amount. It also suggested making this scheme compulsory for all new employees and covering retirees as well.

The 7th Pay Commission took a stronger stand. It stated that a health insurance model would be the best and most sustainable way to provide long-term medical protection to all employees, pensioners, and their families. It also made an important suggestion for pensioners not covered under CGHS—recommending that CGHS should include hospitals already approved under other government schemes like CS(MA) for serving employees and ECHS for retired defence personnel. This would allow more pensioners to access cashless treatment. The commission also advised the government to improve the capacity of CGHS centres to manage the increased demand.

What’s Happening Now?

In early 2025, media reports suggested that the Health Ministry may replace CGHS with a new health insurance-based scheme. This proposed scheme is likely to be named Central Government Employees and Pensioners Health Insurance Scheme (CGEPHIS). It would be managed through insurance companies registered with the Insurance Regulatory and Development Authority of India (IRDAI). However, there has been no official confirmation from the government regarding the launch or implementation of this new scheme.

Unlike CGHS, which relies on government facilities and select private hospitals, CGEPHIS would be implemented by private insurance companies registered with the Insurance Regulatory and Development Authority of India (IRDAI). The government fully funds CGHS, but CGEPHIS might involve payment of premiums to the insurance companies. The new scheme seems to be like the corporate insurance model in which customers pay the insurance premiums. In the case of government employees, the government may pay the insurance premiums.

In CGEPHIS scheme, the employees will get a smart card for claim lodgement and they can also access all insurance facilities via mobile app of the insurance companies.

This scheme – CGEPHIS, is not new and was also in talks in 2010. There were reports in 2010 also regarding implementation of this scheme but the government denied the reports and said that the new CGEPHIS scheme will not be implemented as of now.

Let’s see what happens next—whether the CGHS scheme will continue or the CGEPHIS scheme will replace it. You can download Draft PDF from link below.

• Download Draft PDF