Thiruvananthapuram: Although approval has been granted for the second phase of Medisep—the state government’s health insurance scheme for employees and pensioners—the steep increase in the premium amount has come as a setback to beneficiaries. Under Phase II, which comes into effect from January 1, 2026, the government has decided to deduct a higher amount from monthly salaries and pensions.

Key Concerns

Sharp hike in premium:
The monthly contribution, which stood at 500 during Phase I, has been increased to 810 in Phase II. This escalation is expected to place a heavy financial burden, particularly on pensioners and lower-level employees.

Uncertainty over benefits:

Despite the increase in premium, there is still no clarity on whether there will be any enhancement in insurance coverage or treatment benefits. Beneficiaries are anxious about whether the existing benefits will continue unchanged or be curtailed.

Advance deduction:

The revised premium is proposed to be deducted starting from the December salary itself, which is likely to disrupt household budgets of employees.
Financial Impact
Annual Premium (including GST)
Phase
Monthly Contribution
Phase I
500
6,000
Phase II
810
8,237 + 18% GST

Are complaints being ignored?

During Phase I, there were widespread complaints that several private hospitals denied treatment and that the cashless facility was not effectively provided. Employees argue that increasing the premium without first addressing these unresolved issues has triggered strong resentment.
The scheme has been extended for a further two-year period up to 2028 and continues to be implemented through the Oriental Insurance Company. Service organisations are likely to intensify protests against what they view as the imposition of additional financial liability without announcing any corresponding enhancement in benefits.