Current status and future prospects of ESIC

1. EMPLOYEES’ STATE INSURANCE
SCHEME
Dr. Sumaiya Khatun,
2nd year PGT, Community
Medicine, CNMCH

2. Mission Statement:
To provide for certain benefits to Employees in case of Sickness, Maternity and
Employment Injury and to make provisions for Related matters.
 Employees' State Insurance (abbreviated as ESI) is a self-
financing social security and health insurance scheme for Indian
workers.
 This fund is managed by the Employees' State Insurance
Corporation (ESIC) according to ESI Act 1948.
 ESIC is an autonomous corporation by a statutory creation
under Ministry of Labour and Employment, Government of
India.[1]

3. History:
 In March 1943, B. P. Adarkar was appointed by Government of India to create a report on health
insurance scheme for industrial workers.[2] The report became the basis for the ESI Act of 1948.[2]
 The promulgation of ESI Act, 1948 envisaged an integrated need based social insurance scheme
that would protect the interest of workers in contingencies such as sickness, maternity, temporary or
permanent physical disablement, death due to employment injury resulting in loss of wages or
earning capacity.
 The Scheme was first implemented at Kanpur and Delhi on 24 February 1952.
 The act was initially intended for factory workers but later became applicable to all establishments
having 10 or more workers.
 As on 31 March 2017, the total beneficiaries are 12.40 crores.[4][5]

4. ESI Scheme today (as on 31st march 2017)
Coverage in india:
 No. of States/UTs covered: 30
 No. of Employees: 2.93 crores
 No. of Insured Persons/Family units: 3.19 crores
 No. of Insured women: 40.90 lakhs
 No. of Beneficiaries: 12.40 crores
 No. of Employers covered: 8.98 lakhs

5. Administration:
• Autonomous body- ESI Corporation.
• Chairman- Union Minister for Labour
• Vice-Chairman- Secretary to Govt of India Ministry of Labour
• Standing committee- Chief executive body for administration.
• Chief Executive Officer- Director General.
• Other Principal Officers-
1. Insurance Commissioner
2. Medical Commissioner
3. Financial Commissioner
4. Actuary
• Medical Benefit Council- headed by Director General of health services and assisted by Medical
Commissioner.

6. Administration:
• Head Office- New Delhi
• Others-
a) 23 regional offices
b) 37 sub-regional offices
c) 1 divisional office
d) 2 camp office
e) 627 branch offices
f) 185 cash offices
g) 422 inspection offices

7. ESI Scheme today (as on 31st march 2015)
Infrastructure in India:
 ESI scheme is a type of social security scheme for employees in the organized sector.[7]
 No. of ESI hospitals: 151
 No. of ESI Dispensaries: 1418
 No. of Panel Clinics: 2100
 No. of Diagnostic centers: 307
 No. of Hospital Annexes: 42
 No. of beds: 27000

8. Contributions :
 For all employees earning ₹21,000 (US$320) or less per month as wages, the employer
contributes 4.75 percent and employee contributes 1.75 percent, total share 6.5 percent.
 State Govt. contributes 1/8th of total cost of medical care and ESI’s Corporation share 7/8th of
total expenditure.
 This fund is managed by the ESI Corporation (ESIC) according to rules and regulations
stipulated there in the ESI Act 1948, which oversees the provision of medical and cash
benefits to the employees and their family.

9. Benefits to IPs under ESIC Scheme:
ESI Scheme Provides The Following Major Social Security Benefits To The Insured Persons:
1. SICKNESS BENEFIT
2. MEDICAL BENEFIT
3. MATERNITY BENEFIT
4. DISABLEMENT BENEFIT
5. DEPENDANT BENEFIT
6. FUNERAL EXPENSES
7. PHYSICAL REHABILITATION
8. VOCATIONAL REHABILITATION

10. 1. SICKNESS BENEFIT
There are three types under SICKNESS Benefit
i. General Sickness
ii. Extended Sickness
iii. Enhanced Sickness

11. i. General Sickness
 General Sickness represents periodical cash payments made to an Insured person (IP)
during the period of certified sickness
 And when IP requires medical treatment and attendance with abstention from work on
medical grounds.
 Sickness benefit is roughly 50% of the average daily wages and is payable for 91 days, in
any continuous period of 365 days.
Eligibility Conditions:
 An IP should have paid contribution for not less than 78 days during the corresponding
contribution period.
 A person who has entered into insurable employment for the first time has to wait for nearly 9
months for becoming eligible to sickness benefit

12. ii. Extended Sickness Benefit (ESB)
 An IP suffering from certain long term diseases is entitled to ESB
 ESB includes 34 chronic diseases which are grouped in 11 groups as per International
Classification of diseases
 To be entitled to the Extended Sickness Benefit an Insured Persons should have been in
continuous employment for 2 years or more at the beginning of a spell of sickness.
 ESB shall be payable for a maximum period of 2 years.

13. iii. Enhanced Sickness Benefit (ESB)
 IPs/IWs in the productive age group for undergoing sterilization operations for family welfare
are paid of enhanced Sickness Benefits.
 Leave up to 7 days in the case of IPs (Male) and up to 14 days in the case of the IW’s
(Female) from the date of operation or from the date of admission in the hospital
 Insured Persons eligible to ordinary sickness benefit are paid enhanced sickness benefit at
double the rate of sickness benefit i.e., about full average daily wages.

14. 2. MEDICAL BENEFIT
The Scheme provides full range of medical care to Insured person and family, through a network of
ESI Dispensaries & Panel clinics, diagnostic centers and ESI Hospitals etc.
All Insured Persons and members of their family are entitled to free, full and comprehensive medical
care such as.
1. Out patient treatment
2. Domiciliary treatment
3. Super specialty treatment
4. Specialist consultation and diagnostic facilities
5. In-Patient treatment
6. Free supply of drugs and dressings.

15. 2. MEDICAL BENEFIT
7. X-ray and laboratory investigations
8. Vaccination and preventive inoculations
9. Ante-natal care, confinement and post natal care
10. Family planning services.
11. Ambulance Service or conveyance charges
12. Emergency Services
13. Free diet during admission in hospitals
14. Family welfare services and other national health programmed services
15. Medical certification

16. 2. MEDICAL BENEFIT
Direct pattern and indirect pattern:
Direct pattern-
1. If population > 1000, then full time service dispensaries, medical and para-medical personnel are
established.
2. If population < 750, then part time ESI dispensaries are established.
3. If residential concentration scattered over long distance, then mobile dispensaries.
Indirect Pattern-
• Also known as Panel System.
• Registered Medical Practitioners designated as Insurance Medical Practitioners are appointed to
provide medical care.
• Restricted Medical Care
• Expanded Medical care.

17. 2. MEDICAL BENEFIT
Other medical facilities:
1. Dentures, spectacles and hearing aids are provided for free.
2. Artificial limbs and other prosthetics.
3. Special appliances- hernia belts, walking caliper, surgical boots, spinal braces and jackets.
Cost of medical benefit:
• Per capita medical benefit has been increasing under ESI Scheme steadily.
• In 2012-13 total expenditure was about Rs. 4058 crores.

18. 3. MATERNITY BENEFIT
o For entitlement to maternity benefit, the insured woman should have compulsorily work for 55days
with in 9month from the date of employment.
o Maternity Benefit is payable for a period of 26 weeks for confinement to an Insured Woman.
o Miscarriage or Medical Termination of Pregnancy (MTP)-payable for 6 weeks (42 days) from the
date following miscarriage.
o Sickness arising out of Pregnancy, Confinement, Premature birth-payable for a period not
exceeding one month

19. 3. MATERNITY BENEFIT
o In the event of the death of the Insured Woman during confinement leaving behind a child,
Maternity Benefit is payable to her nominee
o Maternity benefit rate is double the Standard Benefit Rate, or roughly equal to the average daily
wage.
o The rate of confinement expenses has increased from Rs. 2500 to Rs. 5000 per confinement.

20. 4. DISABLEMENT BENEFIT
 Disablement benefit is the personal injury to an employee caused by an accident or by an
occupational disease arising out of employment of the employee in a covered factory or
establishment.
There are two types under disablement Benefit
a. Temporary Disablement Benefit (TDB)
b. Permanent Disablement Benefit (PDB)

21. a. Temporary Disablement Benefit (TDB)
 TDB is payable to an employee who suffers employment injury (EI) or Occupational Disease and is
certified to be temporarily incapable to work.
 This benefit is not subject to any contributory conditions. An IP is eligible from the day he joins the
insurable employment.
 There is no prescribed limit for the duration of TDB. This is payable as long as temporary
disablement lasts and significant improvement by treatment is possible.

22. b. Permanent Disablement Benefit (PDB)
 Permanent Disablement Benefit is paid to an insured person who suffers from permanent disability
as a result of an employment injury (including occupational disease), which results in loss of
earning capacity.
 If the employment injury results in partial or total/permanent disability, the PDB is payable till the
death of the insured person.
 No contributory conditions are prescribed for this benefit. While the rate of temporary disablement
benefit is 90 per cent of the wages and that of permanent disablement benefit is proportionate to the
loss of earning capacity caused by the injury determined by a medical board.

23. 5. DEPENDANT’S BENEFIT
 Dependents' benefit consists of periodical payments to dependents of an insured person who dies
as a result of an employment injury sustained as an employee under the ESI Act.
 There are no contributory conditions for qualifying to this benefit. Thus, if a person dies of
employment injury even on the first day of his employment, his dependents are entitled to the
benefit.
 The minimum rate of DB is Rs.14/- per day and these rates of the DB are increased from time to
time.
 90 % of wages shared by dependents in a fixed ratio on monthly basis.
 An eligible son or daughter is entitled to dependant’s benefit upto age of 18.

24. 6. FUNERAL EXPENSES
 Funeral expenses are in the nature of a lump sum payment up to a maximum of Rs. 10000/- made
to defray the expenditure on the funeral of insured person. The amount is paid either to the eldest
surviving member of the family or, in his absence, to the person who actually incurs the expenditure
on the funeral.

25. 7. PHYSICAL REHABILITATION
 Disabled insured persons who remain admitted in an artificial limb centre for fixation or repair or
replacement of the artificial limb are entitled to rehabilitation allowance for each day on which they
remain admitted at Artificial limb centre at double the standard sickness benefit rate. This is not
subject to any contributory condition.

26. 8. VOCATIONAL REHABILITATION
 This Scheme has been designed to provide financial assistance to the insured persons who are
referred to vocational rehabilitation centre for training.
 Insured person who satisfy following conditions are entitled to avail benefits of the vocational
rehabilitation scheme:
1. whose permanent loss of earning capacity has been determined as 40% or more.
2. who is in receipt of permanent disablement benefit under the ESI Act, 1948.
3. who is not in any gainful employment, and
4. who is not more than 45 years of age on the date of his application.

27. BENEFITS TO EMPLOYERS
1. Exemption from Workmen’s Compensation Act 1923.
2. Exemption from Maternity Benefit Act 1961.
3. Exemption from payment of medical allowance to employees and their dependents.
4. Rebate under Income Tax Act on contribution deposited in the ESI Account.
5. Healthy work-force.

28. RAJIV GANDHI SHRAMIK KALYAN YOJANA:
• Came into effect from 1st April 2005
• Provides unemployment allowance for the employees covered under ESI scheme who
are rendered unemployed involuntarily due to retrenchment/closure of factory etc.
• This allowance can be claimed for a maximum period of 6 months during entire service.
• Employee must have rendered insurable employment and have contributed under the
scheme for 5 or more years.
• The daily rate for the allowance is the “Standard Benefit Rate” under ESI rules,1950.

29. Medical and Dental colleges
Employees' State Insurance Corporation runs medical, dental, nursing and paramedical schools in
many locations across India.[9]
Presently, there are 9 medical colleges and 2 dental colleges established by the ESI Scheme.
 There are 6 medical colleges managed by the Ministry of Labour and Employment (India) under the
ESI Corporation which are located at Kolkata, Faridabad, Hyderabad, Chennai, Bengaluru and
Gulbarga.
 Remaining 3 medical colleges were established by the ESI Corporation but are managed by the
state government. They are:
1. Shri Lal Bahadur Shastri Government Medical College & Hospital Mandi, Himanchal Pradesh
2. Coimbatore ESIC Medical College Coimbatore, Tamil Nadu
3. Government Medical College, Kollam, Kerala
The Dental Colleges run by the ESI Corporation are located in New Delhi and Gulbarga, Karnataka.
The Government of India plans to construct 12 more ESI Medical Colleges in various cities across
India in the upcoming years.[10]

30. New Amendment:
 The Employees’ State Insurance Corporation (ESIC) raised the monthly wage limit to Rs. 21,000,
from the existing Rs. 15,000, for coverage with effect from 1 January 2017 [11]
 Under the concept of Pehchaan Project initiated by ESIC, a unique card is issued to each insured
person, i.e. employee.
 Family members can use their card to avail medical facilities of ESI scheme if they are away or
living in another town.

32. ESI Scheme in West Bengal:
 West Bengal is the key facilitator for rendering the medical services under the ESI Scheme
 Apart from that Industries, hotels, restaurants, theatres, newspaper establishments, road motor or
transport establishments, Shop and other establishments and recently private medical Institution
and Educational Institution have been brought under the purview of this Scheme.
 The Scheme is administered in our state through a network of 14 nos. well equipped hospitals,
about 378 insurance medical practitioners (IMP) 42 Service Dispensaries (SD) and specialty
centres through OPD of each ESI Hospitals, dedicated to the service of employees with annual
numbers of beneficiaries above 39,00,000 nos.

33. ESI Hospital
Joka, Kolkata

34. Medical Care facilities available in West Bengal under the ESI(MB)
Scheme:
 Indoor treatment for IP & Family in the hospitals including all specialties.
 6 bedded ICCU Unit with facilities for implantation of Permanent Pacemaker.
 Super-specialty treatment including facilities of Cardiology, Neurology, Oncology, and
Hemodialysis in the ESI setup and other super specialty facilities from private institutions through
tie-up arrangements.
 Collection and supply of Blood through ESI Blood Bank at Manicktala.
 Ante-natal and post- natal care to women beneficiaries.
 4 Bedded Neo-Natal Care Unit at Kamarhati ESI Hospital.
 Family planning and immunization services.
 Outpatient treatment at Service Dispensaries (SD) / Insurance Medical Practitioner's (IMP)
clinics.
 Specialists' services at the OPD in all the 13 State ESI Hospitals. Cont…….

35. Medical Care facilities available in West Bengal under the ESI(MB) Scheme:
 Diagnostic facilities like all pathological / radiological investigations including
ultrasonography, Echo-Cardiography, CT Scan, MRI Scan, Angiography, Endoscopies etc. at ESI
hospitals and through Tie-up arrangements.
 Free supply of drugs and dressings through SDs, and from Specialist OPDs at each hospital.
 Ambulance facilities at all ESI Hospitals.
 AIDS prevention, awareness & control through the VCCTCs.
 Tuberculosis control through DOTS by participating in RNTCP.
 Free supply of Spectacles and Hearing Aids for both IP & Family.
 Issue of Certificates in Statutory forms in respect of sickness, maternity etc. to I.Ps only.
 Pain Management Treatment at ESI Pain Management Institute, Sealdah.

36. Future Prospects of ESI in India:
 The ESI Corporation during its 173rd meeting held on 16.02.18 under the Chairmanship of Shri
Santosh Kumar Gangwar, Honorable Minister of State for Labour & Employment, Govt. of India has
taken some important decisions towards improvements in its service delivery mechanism.
 The salient features are-
(i) ESIC Vision 2022
(i) Taking over/sanctioning of ESI Hospitals at Barielly (U.P.), Bhubaneshwar (Odisha) , Raigarh
(Chhattisgarh) and Phulwarisarif (Patna)
(i) Establishing Modified Employer’s Utilization Dispensary (Modified EUD)

37. Future Prospects of ESI in India:
 Other important decisions which were taken during the meeting are as follows:
1. The ESIC Vision 2022 envisages expansion of ESI Scheme in each district of the country with target of
covering 10 Crores workers by 2022. Formation of a new sub-committee for fine tuning was also taken.
2. A) To strengthen medical care services in U.P., the decision of taking over of ESI Hospital, Barielly by ESI
Corporation, was taken.
B) Approval for setting up of ESIC Super Specialty Hospital at Bhubneshwar
C)Sanction of 100 bedded ESI Hospital in Raigarh, Chhattisgarh were also reported upon in the meeting.
3. The decision for establishing Modified Employer’s Utilisation Dispensary (Modified EUD) on pilot basis was also
taken in the meeting, with the objective to strengthen stake holders participation in the expansion of primary care
services of ESIC.
4. In order to improve the delivery of health care services and ensuring proper use of resources available in ESIC
Hospitals, decision of establishing Vigilance Inspection Unit in ESIC Hospitals has been taken.
5. Revised Estimates for the year 2017-18, Budget Estimates for the year 2018-19 and Performance Budget for the
year 2018-19 were deliberated upon and approved.

38. References:
1. bibleHR.com. What is ESIC?: ESIC FAQ. Retrieved 1 January 2016.
2. C M Abraham. Sociology for Nurses : A Textbook for Nurses and Other Medical
Practitioners. Retrieved 23 August 2013.
3. "Employee State Insurance: For a handful of contribution, a bagful of benefits24 February
2011" (PDF).
4. E
5. ghyg
6. K.M.Pillai. Labour & Industrial Laws (Fourteenth Edition, 2012 ed.). Allahabad Law
Agency. ISBN 81-89530-71-2.
7. "What is ESI Scheme". Retrieved 6 March 2016.
8. "Kharge launches smart cards for ESIC". The Hindu. Chennai, India. 26 August 2009.
Retrieved 23 February 2011.
9. http://pib.nic.in/newsite/PrintRelease.aspx?relid=113364
10.Medical Colleges under ESIC http://pib.nic.in/newsite/PrintRelease.aspx?relid=113364
11."ESI Wage Limit Rased". Retrieved 7 September 2016.