India: Government Proposes to Broaden Health Insurance Eligibility

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By Madhur Singh

Oct. 13—India's labor ministry has proposed to make 3 million more workers eligible for Employees' State Insurance (ESI), which provides health care to industrial workers and their dependents, by raising the qualifying salary cap from 15,000 rupees ($224) per month to 21,000 rupees ($314).

Under the Employees' State Insurance (Central) Amendment Rules, 2016, announced Oct. 6, all industrial workers earning a salary of up to 21,000 rupees would have access to medical care at more than 1,500 clinics and hospitals run by the Employees' State Insurance Corporation.

Employees contribute 1.75 percent of salary and employers 4.75 percent to the ESI fund each month.

The proposed amendment was announced shortly after major trade unions struck work across the country on Sept. 2 seeking, among other things, better wages and enhanced social security benefits, including improved medical care.

Unions have expressed concern, however, that since more and more employers are opting for a cost-to-company salary structure under which all contributions are drawn from the employee's own take-home salary, the wage ceiling hike may not actually benefit many workers.

The draft amendment is open for stakeholder comment until Nov. 6.

To contact the reporter on this story: Madhur Singh in Chandigarh at

To contact the editor responsible for this story: Rick Vollmar at

For More Information

For more information on Indian HR law and regulation, see the India primer.

The proposed Employees' State Insurance (Central) Amendment Rules, 2016 are available in English


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