Denying Reimbursement for Emergency Treatment at Non-Empanelled Hospitals Places Policy Above Survival, Says Punjab and Haryana HC

Justice Sandeep Moudgil directed a State-constituted committee to re-examine individual claims of Haryana government employees and pensioners denied medical reimbursement on technical grounds, holding that procedural rigidity cannot defeat the constitutional promise of healthcare.

A batch of twelve writ petitions filed by Haryana government employees and pensioners, all challenging the denial or drastic reduction of medical reimbursement claims, has been disposed of by the High Court of Punjab and Haryana at Chandigarh. Justice Sandeep Moudgil, sitting singly, pronounced the common order on 29 May 2026, holding that rejecting reimbursement solely because treatment was availed at a non-empanelled hospital during a medical emergency amounts to placing policy procedure above human survival. The court directed a State-constituted committee to examine each petitioner's claim individually and sympathetically within four weeks, with interest at 6% per annum on any amount found payable.

The Disputes Before the Court

The twelve petitions, led by CWP-16778-2024 (Swati Yadav v. State of Haryana and Others), arose from a common factual matrix. Petitioners included serving and retired State employees who had sought medical reimbursement after receiving treatment—in several cases emergency treatment—at private hospitals not on the State's approved panel. The State had either denied reimbursement altogether or restricted it to PGI rates, which are the benchmark rates of the Post Graduate Institute of Medical Education and Research.

The connected cases spanned several years: CWP-4485-2022 (Ramesh Kumar), CWP-7575-2022 (Jayoti Parshad Sharma), CWP-17505-2022 (Prem Chander Bichhal), CWP-2962-2024 (Maan Singh Sangwan), CWP-2581-2025 (Kamlesh Yadav), CWP-16910-2025 (Neki Ram), CWP-39452-2025 (Arjun Dass), CWP-6039-2025 (Manglesh Sharma), CWP-7966-2025 (Narender Singh), CWP-6438-2026 (Moti Ram), and CWP-8127-2026 (Ajeeta).

Four Legal Questions Framed

Justice Moudgil identified four principal issues cutting across all twelve petitions.

The first was whether reimbursement could be denied entirely, or reduced to a negligible sum, merely because the treating hospital was not on the State's approved panel, even where the treatment was sought in an emergency.

The second was whether the State could lawfully restrict reimbursement to PGI rates alone, even where the policy itself contemplated reimbursement at PGI rates plus an additional 75% in certain situations, thereby defeating the policy's own object.

The third concerned the income ceiling for dependants: whether the stipulation disentitling reimbursement where a dependant's monthly income exceeded Rs. 3,500 was manifestly arbitrary and wholly disconnected from present economic realities and inflation.

The fourth was whether the package rates and treatment modules in the existing policy had become obsolete given escalating healthcare costs and advances in medical science.

The Court's Reasoning on Emergency Access and Article 21

The court opened its analysis by anchoring the right to health and medical care in Article 21 of the Constitution, citing the Supreme Court's recognition in State of Punjab v. Mohinder Singh Chawla, 1997 (1) SCT 716, that the State is constitutionally obligated to bear the medical expenses of its employees, the right to health being integral to life itself.

On the empanelment question, Justice Moudgil acknowledged that premier government institutions such as PGI are centres of excellence. However, the court observed that accessibility to these institutions remains a serious impediment for a vast section of employees, particularly in moments of medical emergency. Long waiting periods, overcrowding, shortage of beds, and the urgency of critical illness often compel patients to seek treatment at the nearest available facility, regardless of its empanelment status.

The court relied on the Supreme Court's ruling in Shiv Kant Jha v. Union of India, (2018) 16 SCC 187, which held in unequivocal terms that the right to a medical claim cannot be denied merely because treatment was taken in a non-recognised hospital, especially where the treatment was emergent and bona fide, and that the State cannot adopt a “wooden or hyper-technical approach” in matters concerning healthcare and survival.

This court's own precedents in Rama Kant Sharma v. State of Haryana and Others, CWP-257-2019, and Hukam Singh v. State of Haryana and Others, CWP-28175-2023, decided on 5 May 2026, were also cited for the proposition that reimbursement policies must receive a purposive and liberal interpretation consistent with Article 21, and that genuine medical claims ought not to be defeated by procedural rigidity or outdated policy formulations.

On the income ceiling of Rs. 3,500 for dependants, the court described the stipulation as manifestly arbitrary, unrealistic, and wholly disconnected from present economic realities and inflationary trends. On the adequacy of package rates, the court found that the existing modules had become obsolete in the face of changing times and rapid advancements in medical science and specialised treatment procedures.

The court also noted that “public health and hospitals” is a State subject under Entry 6, List II of the Seventh Schedule of the Constitution, placing the paramount obligation of safeguarding the health and well-being of citizens squarely on the State, and particularly so for those who have spent the prime years of their lives serving the State machinery.

State's Concession and the Committee

At the hearing, learned State counsel Mr. Deepak Balyan and Mr. R.D. Sharma, on instructions from Dr. Anjali Arora, Deputy Director, who was present in court, submitted that the Government had agreed to examine the grievances raised in matters of this nature. They further stated that the various clauses and stipulations forming part of the existing medical reimbursement policy, including those challenged in the present batch, were under active reconsideration and revisitation by the Government to align the policy framework with contemporary medical realities.

The State also informed the court that it had constituted a committee under the chairmanship of the Additional Director of Health Services, with the Deputy Director of the Medical Reimbursement Branch and the Nodal Officer (Empanelled Hospitals) as members.

Justice Moudgil took the State's statement on record and held that no useful purpose would be served by keeping the petitions pending in light of that concession.

Directions on Individual Claims and Interest

The court directed the committee so constituted to examine the cases of each petitioner individually. A conscious, well-reasoned decision is to be taken in each matter within four weeks from the date of receipt of a certified copy of the order.

The examination is to be guided by the principles laid down by the Supreme Court in Shiv Kant Jha (supra) and State of Madhya Pradesh v. M.P. Ojha, 1998 (2) SCC 554, and by this court in Rama Kant Sharma, Hukam Singh (supra), and Manoj Kumar v. State of Haryana and Others, CWP-4892-2016.

Where any amount is found payable to a petitioner, it shall carry interest at the rate of 6% per annum from the date the amount became due until the date of actual realisation.

Outcome

All twelve writ petitions were disposed of on 29 May 2026. Pending miscellaneous applications in any of the petitions were also disposed of. The State-constituted committee, chaired by the Additional Director of Health Services, must deliver individual, reasoned decisions within four weeks of receiving a certified copy of the order, with 6% interest running on any amounts found due.