100% heakthcare : bringing "responsible contracts" into compliance

The 2015 circular which detailed the guidelines for ‘responsible contracts’ has just been replaced by a new circular which incorporates the rules arising from the 100% Healthcare reform. This new circular will take effect from January 2020. Companies now have all the pointers for bringing their scheme into compliance and can use the opportunity also to take a look at what’s covered.

100% Healthcare: evolution not a revolution

Keeping one’s complementary health insurance scheme in line with the specifications for ‘responsible contracts’ is important for an employer, as the resulting tax and social insurance breaks act as an incentive: tax deductibility of contributions, exclusion from the basis for calculating Social Security contributions, so-called additional solidarity levy payable at a reduced rate, etc. The circular of 29 May 2019 details the impact of the 100% Healthcare reform on ‘responsible contracts’. Despite the turmoil and concerns raised by this reform, it is clear that it ultimately fits in perfectly with what already exists. In practical terms, a “scissors-effect” is applied to a basket of items known as the “A” or “100% healthcare” basket involving all players along the line. For a certain number of items, practitioners will have to reduce their prices to comply with a price cap (MRP). At the same time complementary (second tier) healthcare schemes will have to increase their refund ceilings for those same items. This will reduce an insured person’s co-pay to zero. Other than introducing price capping, the 100% Healthcare reform merely moves the cursor on a series of other parameters.

What process for bringing into compliance?

Bringing schemes into compliance is nevertheless inevitable. From 1 January 2020 the new rules concerning optical appliances and dentures will gradually come into effect. The specifications for ‘responsible contracts’ will again be modified as of 1 January 2021 so as to incorporate new rules for hearing aids and for a second batch relating to dentistry. Your scheme will remain ‘responsible’ up to the day before the policy anniversary date. At that moment your insurer will have issued an endorsement altering the terms of the policy.

Are contributions really going up?

As regards the formality (single declaration of employment [DUE] or collective agreement) which enabled the supplementary healthcare scheme to be set up in the company, there are two possibilities. If the DUE contains a commitment as to the cover offered to staff, then this document must be made compliant by issuing an endorsement before the scheme anniversary date. If, as recommended by Gerep, the commitment contained in the document initialising the scheme refers to contribution levels and not cover levels then you will have nothing to do as the document remains compliant. Are contributions really going up? In the debate after the wraps started coming off the reform, a lot of people came out saying that there was a risk that contributions would go up. This is true for ‘low cost’ schemes where the extent of cover is to be increased. However, the impact of 100% Healthcare on ‘premium’ schemes will bring about slightly lower contributions (-2% on average for schemes managed by Gerep). This is logical because even the most generous schemes will reduce their cover for all optical items in basket “A” by €50 and will hardly be able to do better on freely priced items. Employers have every interest in having their situation assessed in order to benefit, where possible, from this additional leeway. And also take the opportunity to improve some particularly original covers or those much appreciated by staff, such as osteopathy or alternative medicines.

Damien Vieillard-Baron