Telangana’s revamped Employee Health Scheme has run into delays despite salary deductions from employees and pensioners. With nearly Rs 2,600 crore in pending hospital dues and empanelment yet to be completed, private hospitals and employee unions are demanding faster implementation and greater transparency.
Published Date – 16 July 2026, 02:55 PM
Hyderabad: The ambitious rollout of Telangana’s revamped Employee Health Scheme (EHS) has hit a major roadblock, as the State government increasingly faces criticism over delayed implementation and poor coordination with private network hospitals, despite mandatory deduction of 1.5 per cent from salaries and pensions.
At present, the State government is sitting on pending/uncleared medical bills of private hospitals worth nearly Rs 2,600 crore. The Aarogyasri medical bills in the past 11 months have amounted to close to Rs 2,000 to Rs 2,100 crore, while the pending medical bills related to the old EHS amount to about Rs 500 crore.
While the government began collecting these contributions to fund the new Employee Health Care Trust (EHCT) two months ago, the initiative remains largely non-operational. As of Wednesday, July 15, employee unions and industry experts report a widening trust deficit between the State and the private healthcare sector.
Deducting funds before the scheme is operational is a breach of trust. The premiums have already been collected for two months from the salaries and pensions of the State government employees, but the agreements with network hospitals have not been finalised. Even the health cards for families covered under EHS have not been issued, they point out on condition of anonymity.
The impasse with private hospitals reflects a long-standing pattern of friction between the State government and Telangana Network Hospitals Association (TANHA).
Private healthcare providers, which cover nearly 80 percent of State’s EHS cashless medical delivery services, have repeatedly warned that the State government’s top-down approach includes unilateral policy shifts and failure to clear substantial pending dues.
At present, anywhere from Rs 800 crore to Rs 1,000 crore in medical bills are pending, individuals close to the initiative said.
On their part, the representatives of private hospitals have maintained that there is a need to adopt a scientific costing methodology that is sustainable and realistic.
“The State government simply revised the existing CGHS package rates and asked us to accept. Moreover, these rates are even less than the existing Aarogyasri rates and previous EHS rates,” TANHA members said.
The current standoff leaves patients in a precarious position, waiting for a safety net that remains, for now, strictly on paper.
What does EHS need to succeed?
Contributions from employees/retirees deposited in ECHT must not be used as a stopgap fund for other government expenses
Immediate resolution of hospital empanelment delays
Expedite issuance of health cards to government employees/pensions
Provide representation of private hospitals in trust for collaborative policy making
Shift from arbitrary rate-cutting to a sustainable costing model
Just like EHS, the EHCT also does not provide a time-bound grievance redressal mechanism
Implement an automated audit system to ensure medical bills are cleared within a fixed, predictable timeframe
