CPAO Issues Detailed Guidelines for Grant of Fixed Medical Allowance to NPS Pensioners

The Central Pension Accounting Office (CPAO), under the Department of Expenditure, Ministry of Finance, has issued a comprehensive Office Memorandum outlining the procedure for grant and disbursement of Fixed Medical Allowance (FMA) to pensioners and family pensioners covered under the National Pension System (NPS).

The order, dated April 16, 2026, provides clarity on the modalities for sanction, payment, and administration of FMA, in continuation of earlier instructions issued by the Department of Pension & Pensioners’ Welfare (DoP&PW).

Payment Through Banks via CPPCs

As per the memorandum, FMA to eligible NPS pensioners and family pensioners will be disbursed by Pension Disbursing Banks through their Central Pension Processing Centres (CPPCs). CPAO will play a key role in initiating payments by issuing a Special Seal Authority (SSA) after completing necessary checks.

Upon receipt of SSA, CPPCs will credit the FMA directly into the pensioners’ bank accounts on a quarterly basis, as per rates notified by the government from time to time.

No Claim Required from Pensioners

The memorandum makes it clear that FMA payments will be automatic. Pensioners are not required to submit any bills or claims for receiving the allowance. Banks are instructed to strictly adhere to the SSA instructions issued by CPAO.

Option to Switch to CGHS

In cases where a beneficiary opts to shift from FMA to CGHS (OPD) facilities, the procedure prescribed in the DoP&PW Office Memorandum dated March 23, 2022, will be followed.

Transfer of Pension Accounts

For pensioners transferring their accounts from one bank to another, the existing procedure laid down in the CPAO scheme booklet for pension payments will apply.

Mandatory Life Certificate Submission

The order reiterates that pensioners receiving FMA must submit their life certificate—either digital or physical—every year in November. Failure to do so will affect continuation of FMA payments.

It is specified that FMA for the months of September to November will be released in the first week of December, while subsequent payments from December onward will be contingent upon submission of the life certificate.

Provisions After Death of Beneficiary

The memorandum also details procedures in the event of the death of an FMA beneficiary:

• If an eligible spouse or family member is already mentioned in the FMA payment authority, they can apply directly to the bank with a death certificate to continue receiving FMA.
• If no eligible family member is listed, the claimant must approach the Head of Office for issuance of fresh FMA authority.

Reimbursement and Reporting

CPPCs are required to follow CPAO guidelines for reimbursement, accounting, and reporting. The FMA disbursed to retired NPS employees and their families will be reimbursed to banks by the government under the existing system.

Compliance and Future Instructions

All CPPCs have been directed to take necessary action for compliance with these instructions. CPAO has indicated that detailed guidelines for system integration with banks for FMA payments will be issued separately.

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