ESIC privatisation push counterproductive, warns new report

A new report examining the Employees' State Insurance Corporation (ESIC) has cautioned the central government against any move to privatise the state-run social security organisation. The report, titled ESI Ki Baat and prepared by the non-profit Safe In India, argues that privatisation as a default or ideological position would be counterproductive.

The report suggests that private involvement should only be considered where there is clear evidence of better outcomes for workers, employers, or the ESIC itself. It adds that any such arrangement must leave the ESIC in control, with the power to set rules and reverse the partnership if needed.

On the subject of coverage, the report recommends raising the wage ceiling for ESIC eligibility from the current ₹21,000 to ₹33,000 per month. This change would bring more workers under the social security net.

Speaking at the report's release, ESIC Director General Ashok Kumar Singh said the number of beneficiaries is growing rapidly. He noted that the corporation is developing a digital system to reduce human interference and make processes rule-based. Singh also mentioned that Panchdeep 2.0, an upgraded digital platform for healthcare and cash benefits, would be launched soon.

Regarding the Code on Social Security, Singh said its implementation would help more workers access benefits. He pointed out that the definitions of establishments and workers under the code are broad enough to potentially include farmers. He added that the government is working on a suitable scheme for gig and platform workers.

The report also examined ESIC's tie-up with 2,836 private hospitals. While this has expanded access to treatment for insured persons, the report notes that delays in treatment and out-of-pocket expenses persist. It acknowledges that such partnerships provide much-needed support, especially given the difficulty in hiring specialist doctors for public hospitals, but warns that this could shift focus away from improving ESIC's own infrastructure.

Drawing on global experience, the report states that healthcare privatisation works only where regulatory capacity is strong enough to enforce standards and prevent issues like cream-skimming. It urges that any reform proposal involving the private sector must clearly demonstrate how regulation will be designed, enforced, and sustained.